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The 
^ORTH CAROLINA 

REGISTER 



IN THIS ISSUE 



» 



! morth , 



TITU 
iTIONl 



ILECIBUS^ 
SALUS -^ 



PROPOSED RULES 

Certified Public Accountant Examiners 

Economic and Community Development 

Environment, Health and Natural Resources 

Human Resources 

Insurance 

Labor 

Public Education 
FINAL RULES 

Transportation 
RRC OBJECTIONS 
RULES INVALIDATED BY JUDICIAL DECISION 

ISSUE DATE: NOVEMBER 15, 1991 
Volume 6 • Issue 16 • Pages 1108-1275 



INFORMATION ABOUT THE NORTH CAROLINA REGISTER AND ADMINISTRATIVE CC 



NORTH CAROLINA REGISTER 

The North Carolina Register is published bi-monthly 
and contains information relating to agency, executive, 
legislative and judicial actions required by or affecting 
Chapter 150B of the General Statutes. All proposed, ad- 
ministrative rules and amendments filed under Chapter 
150B must be published in the Register. The Register 
will typically comprise approximately fifty pages per 
issue of legal text. 

State law requires that a copy of each issue be pro- 
vided free of charge to each county in the state and to 
various state officials and institutions. The North Carolina 
Register is available by yearly subscription at a cost of 
one hundred and five dollars ($105.00) for 24 issues. 

Requests for subscriptions to the North Carolina 
Register should be directed to the Office of Ad- 
ministrative Hearings, P. O. Drawer 27447, Raleigh, N. 
C. 27611-7447, Attn: Subscriptions. 

ADOPTION, AMENDMENT, AND REPEAL OF 
RULES 

An agency intending to adopt, amend, or repeal a rule 
must first publish notice of the proposed action in the 
North Carolina Register. The notice must include the 
time and place of the public hearing; a statement of how 
public comments may be submitted to the agency either 
at the hearing or otherwise; the text of the proposed 
rule or amendment; a reference to the Statutory 
Authority for the action and the proposed effective date. 

The Director of the Office of Administrative Hearings 
has authority to publish a summary, rather than the 
full text, of any amendment which is considered to be 
too lengthy. In such case, the full text of the rule con- 
taining the proposed amendment will be available for 
public inspection at the Rules Division of the Office of 
Administrative Hearings and at the office of the pro- 
mulgating agency. 

Unless a specific statute provides otherwise, at least 
30 days must elapse following publication of the pro- 
posal in the North Carolina Register before the agency 
may conduct the required public hearing and take ac- 
tion on the proposed adoption, amendment or repeal. 

When final action is taken, the promulgating agency 
must file any adopted or amended rule for approval by 
the Administrative Rules Review Commission. Upon ap- 
proval of ARRC, the adopted or amended rule must be 
filed with the Office of Administrative Hearings. If it 
differs substantialh' from the proposed form published 
as part of the public notice, upon request by the agen- 
cy, the adopted \ersion will again be published in the 
North Carolina Register. 

A rule, or amended rule cannot become effective 
earlier than the first day of the second calendar month 
after the adoption is filed with the Office of Ad- 
ministrati\'e Hearings for publication in the NCAC. 

Proposed action on rules may be withdrawn by the 
promulgating agency at any time before final action is 
taken by the agency. 

TEMPORARY RULES 

Under certain conditions of an emergency nature, 
some agencies may issue temporary rules. A temporary 
rule becomes effective when adopted and remains in 



effect for the period specified in the rule or 18C 
whichever is less. An agency adopting a temporal 
must begin normal rule-making procedures on tl 
manent rule at the same time the temporary 
adopted. 

NORTH CAROLINA ADMINISTRATIVE CO 

The North Carolina Administrative Code (NC 
a compilation and index of the administrative n 
25 state agencies and 38 occupational licensing b 
The NCAC comprises approximately 15,000 lett 
single spaced pages of material of which approx 
ly 35% is changed annually. Compilation and pi 
tion of the NCAC is mandated by G.S. 150B-63 

The Code is divided into Titles and Chapters 
state agency is assigned a separate title which 
ther broken down by chapters. Title 21 is desi 
for occupational licensing boards. 

The NCAC is available in two formats. 

(1) Single pages may be obtained at a mii 
cost of two dollars and 50 cents ($2.50) 
pages or less, plus fifteen cents ($0.15)p( 
additional page. 

(2) The full publication consists of 53 vo 
totaling in excess of 15,000 pages. It 
plemented monthly with replacement p 
one year subscription to the full publica 
eluding supplements can be purchas 
seven hundred and fifty dollars ($750. ( 
dividual volumes may also be purchase 
supplement ser\'ice. Renewal subscripti 
supplements to the initial publication av; 

Requests for pages of rules or volumes of the 
should be directed to the Office of Adminis 
Hearings. 

NOTE 

The foregoing is a generalized statement of t 
cedures to be followed. For specific statutory lar 
it is suggested that Articles 2 and 5 of Chapter ] 
the General Statutes be examined carefully. 

CITATION TO THE NORTH CAROLIN; 
REGISTER 

The North Carolina Register is cited by volume 
page number and date. 1:1 NCR 101-201, April 

refers to Volume 1, Issue 1, pages 101 through 
the North Carolina Register issued on April 1 



North Carolina Register. Published bi-monthly b 
Office of Administrative Hearings, P.O. Drawer 2 
Raleigh, North Carolina 27611-7447, pursuai 
Chapter 150B of the General Statutes. Subscrip 
one hundred and five dollars ($105.00) per yej 
North Carolina Administrative Code. Publish 
looseleaf notebooks with supplement ser\'ice b 
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Chapter 150B of the General Satutes. Subscrip 
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volumes available. 



NORTH 
CAROLINA 
REGISTER 



ISSUE CONTENTS 




Office of Administrative Hearings 

P. O. Drawer 27447 

Raleigh. \C 27611-7447 

(919) 733-2678 



I. PROPOSED RULES 

Economic and Community 
Development 

Credit Union Di\ision 1108 

Environment, Health, and 
Natural Resources 

Coastal Management 1 139 

Human Resources 

Departmental Rules 1 1 14 

Insurance 

Life and Health Division 1114 

Labor 

Occupational Safety and 

Health 1138 

Licensing Board 

Certified Pubhc Accountant 

Examiners 1 141 

Public Education 

Elementary and Secondar)- 1140 



Julian Mann IH, 

Director 
James R. Scarcella Sr., 

Deputy Director 
MoUy \Iasich, 

Director AP A Services 



Staff: 

Ruby Creech, 

Publications Coordinator 
Teresa Kilpatrick, 

Editorial Assistant 
Jean Shirley, 

Editorial Assistant 



II. FINAL RULES 

Transportation 

Assistant Secretary for 

Management 1254 

Assistant Secretary' for 

Plarming 1259 

Departmental Rules 1 142 

Division of Highways 1 146 

Division of Motor Vehicles 1229 

III. RRC OBJECTIONS 1265 

W. RULES rSTALIDATED BY 

JUDICIAL DECISION 1270 

V. CUMULATIVE INDEX 1272 



NORTH CAROLINA REGISTER 

Publication Schedule 

(October 1991 - December 1992) 



Issue 


Last Day 


Last Day 


Earliest 


Earliest 


Last Day 


+ 


Date 


for 


for 


Date for 


Date for 


to 


Earliest 




Filing 


Electronic 


Public 


Adoption 


Submit 


Effective 






Filing 


Hearing 


by 


to 


Date 




TT***T++++++*T*+++++ 


+++T++*TT+ 


Agency 


RRC 




***++*** 


« + + * + + **■■ + 


=fT±* + ±+;«* + 


****+**** 


10 15 91 


09 24 91 


1001,91 


10 30,91 


11 14 91 


11/20/91 


01 02 92 


11 01 91 


10 1191 


10 18,91 


11 16 91 


12 01 91 


12 20/91 


02 03 92 


11 15 91 


10 24 91 


10,'31/'91 


11/30/91 


12 15 91 


12 20 91 


02 03 92 


12 02 91 


11 07 91 


11/14/91 


12 17/91 


01 0192 


01 '20. 92 


03 02-92 


12 1691 


11 21 91 


12 02,91 


12 31 91 


01 15 92 


01 20/92 


03 02/92 


01 02 92 


12 09 91 


12/16 91 


01 17,92 


01 31 92 


02 20/92 


04 0192 


01 15 92 


12 20 91 


12 31 91 


01 30 92 


02 14 92 


02 20 '92 


04 01 92 


02 03 92 


01 1092 


01 17/92 


02 18,92 


03 04 92 


03 20. 92 


05 01/92 


02 14 92 


01 24 92 


01/31/92 


02 29/92 


03 15 92 


03/20/92 


05 01,92 


03 02 92 


02 10 92 


02 17,92 


03' 17/92 


04 01 92 


04 20/92 


06 01 92 


03 16 92 


02 24 92 


03 02 92 


03 31/92 


04 15 92 


04 20/ 92 


06 01/92 


04 01 92 


03 1 1 92 


03 18 92 


04 16 92 


05 01 92 


05 20/92 


07 01/92 


04 15 92 


03 25 92 


04 01 92 


04 30 92 


05 15 92 


05 20/92 


07 01 92 


05 01 92 


04 10 92 


04 17,92 


05 16/92 


05 3192 


06/20/92 


08 0392 


05 15 92 


04 24 92 


05 01.92 


05 3092 


06 14 92 


0620/92 


OS 03 92 


06 01 92 


05 1 1 92 


05 18/92 


06 16/92 


07 01 92 


07/20/92 


09 0192 


06 15 92 


05 25 92 


06 01 92 


06 30 92 


07 15 92 


07/20/92 


09 01 92 


07 01 92 


06 10 92 


06 17 92 


07 16 92 


07 31 92 


08-20/92 


10 01 92 


07 15 92 


06 24 92 


0701,92 


07 30/92 


08 14 92 


08/20/92 


10 01 92 


OS 03 92 


07 13 92 


07 20 92 


08 18/92 


09 02 92 


09-20 92 


1 1 02 92 


08 14 92 


07 24 92 


07-31-92 


08 29; 92 


09 13 92 


09 '20, 92 


11 02 92 


09 01 92 


08 1192 


08 18'92 


09 16/92 


10 01 92 


10 '20/92 


12 01 92 


09 15 92 


08 25 92 


0'^ 01 92 


09 30,92 


10 15 92 


10- 20 '92 


12 01 92 


10 01 92 


09 10 92 


09 17,92 


10 16/92 


10 31 92 


11/20 92 


01 04 93 


10 15 92 


09 24 92 


1001,92 


10 30/92 


11 14 92 


1 1 20 92 


01 04 93 


11 02 92 


10 12,92 


10 19/92 


11.17/92 


12 02 92 


12 20 92 


02 01 93 


11 16 92 


10 23 '92 


10/30 ''92 


12 01 92 


12 16 92 


1220,92 


02 01/93 


12 01,92 


11 06 '92 


11 13 92 


12 16 92 


12 31 92 


01 20 93 


03 0! 93 


12 15 92 


11,24,92 


12 01,92 


12 30/92 


01 14 93 


01 20/93 


03 01 93 



* The "Earliest Effectn-e Dale" is computed assuming t/iat the agency follows 
the publication schedule above, that the Rules Rciiew Commission approves the 
rule at the next calendar month meeting after submission, and that RRC delivers 
the nde to the Codifier of Rules five (5) business days before the 1st business 
day of the next calendar month. 



PROPOSED RULES 



II I Li: 4 - DKP AR r.MKM OF KCONOMIC 
AND COMMLMI Y DKMXOFMKM 

[y otice is hereby }>iven in accordance with G.S. 
I50B-2I.2 that the Department of Economic and 
Community Development, Credit Union Division 
intends to amend rule(s) cited as 4 NCAC 6C 
.0407. 



1 he proposed effective 
February I, 1992. 



date of this action is 



1 he public hearing will be conducted at 10:00 
a.m. on December 2, 1991 at 1 1 10 Na\-aho Drive, 
Raleigh. NC 27609. 

IXeason for Proposed .'iction: Rule changes are 
needed to allow state credit unions to operate un- 
der state rules and regulations in lieu of federal 
rules and regulations. 

y^omment Procedures: Request to be heard will 
be received up to 4H hours prior to the December 
2, 1991 hearing. Written comments will be re- 
ceived for 30 days after publication. 

CIIAI'IKK 6 - CRKDIT UNION DIMSION 

SI IK IIAI'TEK 6C - CREDll LNIONS 

StXriON .0400 - LOANS 

.0407 HLSINESS LO,\NS 

(aj Icn Percent Limit. No loan or line of 
credit advance may be made to any member it 
such loan or advance would cause that member 
to be indebted to the North Carolina Credit I n- 
ion upon loans and advances made to the mem- 
ber in aggregate amount exceeding 10 percent of 
the (Credit I'nion's total unimpaired shares and 
surplus. In the case of member business loans, 
as herein defined, additional limitations apply as 
set forth in this Rule. 

(b) Prohibited Fees. A North Carolina credit 
union shall not make any loan or extend any line 
of credit if, either directly or indirectly, any com- 
mission, fee or other compensation is to be re- 
ceived by the Credit Union's directors, 
eorrunittee members, senior management em- 
ployees, loan otricers, or any immediate family 
members of such indiv iduals, in connection with 
underwnting, insuring, senicing, or collecting the 
loan or line of credit. However, salary (except 
commissions) for employees is not prohibited by 
this Section. For purposes of this Section, 
"senior management employees" means the 



Credit Union's chief executive officer (typically 
this individuaJ holds the title of President or 
Treasurer, .Manager), any assistant chief executive 
officers (e.g.. Assistant President, Vice President 
or Assistant I reasurer, .Manager) and the chief 
financial officer (Comptroller), and "immediate 
family member" means a spouse or other family 
member living in the same household. 

(c) .Nonprefercntial Ireatment. The rates, 
terms and conditions on any loan or line of credit 
either made to, or endorsed cir guaranteed by: 

(1) an official, 

(2) an immediate family member or an offi- 
cial, or 

(3j any individual having a commt)n owner- 
ship, investment or other pecuniary inter- 
est in a business enterprise with an official 
or with an immediate family member of 
an official, 
shall not be more fa\orable than the rates, terms 
and conditions for comparable loans or lines of 
credit to other credit union members. "Immedi- 
ate family member" means a sp(5use or other 
family member living in the same household. 
f4f Mc ' inluT IUp . inL" .>. 1 oanr . . 
(-+-> Dcfinition - j 

(-Ai "MumbL - r bu 'i incji' . loan" nic ' cinr i tmy 

loan, l+ft« «+ cr e dit, B+ iL ' llijr rtf orudit. t+H» 

procL ' odLi «+ vvhioh w+W bt» U '. od ft+f » 

comiiKTciul, coriiorutc. bu ' jin t»j.-i . t+f iign 

cullural purpo 'i L ' , cMccpt thrtt- t+H? fcillo' < s iiig 

;. hall »«*• be con '^ idLTud nK ' mbi - r buhincj^ 

loun ; i fof piirpo! > L"i (4 4wt Soction: 

f+f A U>an t4»4- hs 1uL1; i wcurcd by a litn* 

(->«• * Hwe to loLir liiinil;; d^sijll i iig (4***- i^ 

(-1-^ t44i* iiiL ' mbL ' ro primary rc . iduncL ' ; »f 

fFF^ (+k» mc ' mhijr'i i suoondar^' rcv i idoncL i ; 

(III) tme DtliL ' r ' iuch d' i ' i L ' llirig owned 
by tbe mfmbc ' r. 

f++| A loan thrri- » fully ticourcd hy nharLTi 
H* (4+<* CrL ' dil I ni^)n b+ d e pojiil ' j t» oth e r 
financial i n 'i litiitioii ' .i. 

f+ti-f A lorin. tbe proLL i ud ' i b( which «f« 
U ' . . c'd IrHf a commi- ' roial, coqinrutL ' , bii '. i 
nosa, ef agncullural puipo '. cv made t» a 
boiTowor k*f »«■ a ' i ' jociato mL ' mbcr (*» 
dofinud hLToin ). ' ■ nhich, sshijn added to 
oth e r '. uch lounii to t4+e horrowur t+f *s- 
i . ociatud inumliL ' r. t^ le-T-r than t v i enty 
fwe thousand dollar! , C^iJ^.OOd). 

f+v-f A loan, t-be rupa; , inent t4 vdiii.h t^ 
fully in ' . . urL ' d Bf fulh i guaranlecd bvr n+ 
V i hiTD thorc H* rtft ad' i iinon coinniitiiK ' iit 
to purcha '. o m (+41- bvr w+y uguiicy h4- U^ 
I eil e ni l gos e m i nent t+f *4 » >. lat e t*f emy 
»i ite political '. ubdi' i i '. ion !. . 



6:16 NORTH CAROLIN.i REGISTER November 15, 1991 



1 1 lis 



PROPOSED RULES 



(6^ "Ro ' jonx'D" moann aij- rL!nup . 'on, including 
y+e jMlcT i sancQ fof loan 1 oiif i CTi account, 
a+hi uikH' i iiJl ' iJ L ' amingii wf i. urpiui i . 
(44 "i\^ .ii OciatL'd ML'inliL ' r" mcan ^i afty 
nu - mbor ' ■ vitli a cumnuin o' . siiL'r '' hip, m- 
' i LT . tinent »f other pecuniary intoroiit m a 
buf i incno Bf comnicrcial tMidcu' i Or. 
(4^ "linniL ' diatL ' lumily McmbcM " m e ano a 
■ ipou -. i. ' . «-vF other tiimily memb e r living » 
At» ; iuin e hou '. t ' hold. 
f4t Roquiroment 'i . A North Carolina crc'ilit 
union Fftav make * member bu ' jiner . n loans 
only ift accordance vs ith f+H* applicabl e 
provision ;. Bi t4»* aft4 aW other Rules 
promulgated by Ae North Carolina 
Credit Iriiion iVJmini '. lrator, including th« 
following requirements: 
(A^ W'nttc'ii I oan I'olicio ' j. ¥h« Board ef 
dir e ctors inu '. t adopt 'i pocific businos '. loan 
policies awd- re' . ie' . ' i them at- least annually. 
44te policies ■■ hall, at- a minimum, address 
ti*t* lollo' i i i ing: 
(4-^ I'ypes &f business loans Aa4- Vr+ii t>e 

made. 
f+H -t-ht* C?rc ' dit I'nion's trado area fef 

busiiie '.'. loans. 
(«-)- ■^la.\lmum amount ef credit union 
assets, ift relation te- reser . es, Aat- wili 
be in' i 'e '. tod » bu '. iness loans. 
f+vf .Ma\imuni amount h+ credit union 
as ^i els, m- relation t++ resen es, t+4a4- Vritt 
l*e ime '. led » a gisen categop . ef type 
»f business loan. 
fvf Ma.vimum amount f>f credit union 
a ^i r i ets, m- relation k+ reserves, tfctt- Vi4H- 
fe>r» loaned to am- e«e member &f gioup 
Bi O '. sociated members as her e in d<?- 



fv-i->- (Qualifications aft4 experience »i pet^ 
sonnel imnl' i ed m- making aft4 admin 
istenng bu 'i ine '. s loans. 

fvii-)- Analysis e4-' tfee ability frf A<» bor 
rovser tt+ repay Ae loan. 

(' l iii) 4-be toUowing considerations shall 
bt» addressed unless Ae board »f direo 
tefs finds t+Kft- i4+ey- afe ho^ appropriate 
fof a particular ty-p** el business loan 
aH4 states tht^ reasons fof those findings 
ifi- Ae (Credit I'nion's writt e n policies: 
balance sheet, trend »fi4 structur e anal 
■ ratio aiiLil' i sis t+f easit- flow, mcoine 



aftd expenses. a«4 ta* data: leveraging: 
companson with industry averages; Fe- 
c e ipt a«4 period i c updating «+ financial 
statements aft4 (^iher documentation, 
including t+Ht returns. 
fi*^ Collateral requirements, including 
loan to value ratios; appraisal, W4e 



search aH4 insuranc e requirements; 
steps te- be taken te- s e cure various types 
&f collateral: aH4 how often t4*e valuo 
aft4 marketability »f collateral i* reoval 
uated. 
(*) Appropriate? interest rates aft4 matu 

ritios ef business loans. 
{^ I oan monitoring. servioLng aft4 
follow up procedures, including eol- 
lection procedures. 
fsiif Provision fof periodic disclosure te- 
the Cr e dit Union's member trf the 
number a«4 aggregate dollar amount 
»f m e mber business loans, 
(.xiii) Identification, by- position. »f those 
senior management employees prohib 
ite4 from receiving member business 
loans by- Section fe-^ »f tb+s Rule. 
ff^ Business 1 cans te- Owe Borrower. 
I ' nless a greater amount hs approved by- 
tbe North Carolina Credit I nwn i\dmin 
istrator, tbe aggregate amount ef out 
standing member business loans te- afty 
Bfte member &f group ef as . sociated 



members shall ftH+ exceed 20 percent ef 
tbe Credit I nion's reserves. W a«y por 
ttefi- e+ a member busines . s loan is fully 
secured by a efte te- fe«f famiJv dwelling 
that- IS the member's primapr residence, 
secondary residence, t-vf t+«e other such 
dwelling owned by the member, t+f by 
slujes tft the Credit Union. Hf deposits is- 
another financial institution, t+f ins i ured 
e* guarcmteed byr e* subject k* a«- c 
commitment tn- purchase byr a«y agency 



»f the I'ederal government t+f hI a stat e 
»f am- (-4 its political ^ . ubdivi^ . ions. such 
portion shall Het- be Ciilculated ift deter 
mining the 34> percent Umit. Credit hh- 
i»fts seeking aa e.xcoption from the 30 
percent limit must pre '. ent the i\dminis 
Irator with, at a minimum: the hidi e r 



limit i i ouglit: aft explanation t-rf the need 
te- rais e the limit; a» analysis trf the Credit 



Union's prior experience making member 

business loans: afi4 a copy e>f its business 

lending policy. 
{Q-f Allowanc e h+f 1 oan I,0 '' Ses. 

f++ 44ve d e t e rmination vv ' h e th e r a member 
bu -. iness loan Vr4h be ckissified as st+b- 
staiidard. doubtful. h+ lo '.'. . fof puq'io -' 
ef the vakuition allowanc e h+f h+aft 
losses, wth Fely &» factors fte4- limited 
to- the delinquency el the loan. Non 
delinc]uent loan ', may be cla 'i "ified. de- 
pending t>» aft evaluation t4" fictors. 
including, htit- ftt*t limited k*7 the ade- 
quacy of analysis aft4 documentation. 



1109 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



. 



PROPOSED RULES 



(it) Loans claoT . iriijd shall be rooor i od a* 

foilov i o: 

(i) Subiitandurd loans sA teft porcant 
©f outstanding amount unless othor 
factors (o.g., historr ef such loans at- 
the Credit Union) indicuto a ijoator 
9f L'ssLT amount is appropriate. 
Loans classified a* substandard loans 
afe inadoquately protected W Ae 
current sound worth aftd paying 6«- 
pacity ef Ae obligor »f ©f t4^ coUat 
iH^ pledg e d, if aftyr Loans classifiod 
must have a well defined weakness 
e* » ealcnesses Aat- joopardige ti*e 
liquidation ©f t^ debt. "Lhoy afe 
characterij'.ed W t+» distinct possibil 
ity t4*a* Ae Credit L'nion ¥riii sustain 
some lew tf (4w* defici e ncies afe net 
corrected. Loss potential, while e?t- 
isting ift tbe aggregat e amount ei 
substandard loans, does net- have t» 
exist ift indi' i idual loans classified 
substandard. 

fH) Doubtful lea«* a* ^ percent ef 
outstanding amount. Loans classi 
l+e4 as doubtful loans have aii Ae 
weakness e s inherent ift ones classified 
substandard, with the iidded charao 
teristic that- f+>e V i eaknesses make 
collection »f liquidation ift foHr ©ft 
the ba ^. is e4~ currently existing facts, 
conditions, aftd values . , highly quos 
tionable aft4 improbable. The pos 
sibility »f less is extremely high, btri- 
because »f certain important aft4 
reas . onably specific pending factors 
which Fftay work te the advantage 
aft4 strengthening ef the loan its 
classification as aft estimated less is 
d e ferred until its mor e e .\act status 
may he determined. Pending factors 
include: proposed merger, acquis! 
tion, Bf liquidation actions, capital 
inj e ction, perfecting li e ns w* addi 
tional collateral. aft4 refinancing 
plans. 

{^^ Loss loans at 4-00 percent ef ewt- 
standing amount. Loans classified 
as less loans afe considered ho- 

i"-.-illi-ii-fit-tLt ' I T1 J 1 ■ -y T .. 1 I 1--I1 1 « t f L-t T - ■ . I 1 1 . t t 1-1 '1 t 
*- \J U. W I IT.'IT_ CTTTCr CTT .^' *. It. 1 1 li I I W f \JLX Ki\J 1 1 1 11 1 

their continuance as loans is Ret 
warranted. This classification does 
ftet nece 'i sarily mean that the loan 
has absolutely He reco' i eP f ef sal ' ■ age 
saluo, h+rt- rather tt is ftet practical e* 
d e sirable te defer writing eff this has- 
icallv worthless asset even thouali 



partial recc i er i ' Fftay occur ift the fa- 

(e) Member Busin e ss Loan Prohibitions. 
(+} Senior Management Lmployees. A North 
Carolina credit union m^ ftet mako 
member business loans te the following 
non ' . olunteer. s e nior management efti- 
ployees. ef te any associated member ef 
immediat e family m e mber ef such Mft- 
ployees: 

(rVi Aftv member ef the Board ef Directors 
w4*e is compensated as such. 

fftf The Credit L'nion's chief executive ef- 
6eeF (typically this individual holds the ti- 
tle ef President ef Treasure; .Manager). 

fG) j\ny assistant chief oxecutiso offic e rs 
(e.g.. Assistant President, Vice Pr e sid e nt, 
ef Assistant Treasurer ' Manager). 

(4^ The chief financial officer (Comp 
troUer). 
fO-^ "Lquity Kickers." A North Carolina 
credit union shall ftet grant a member 
business loan where a portion ef the 
amount ef income te t?e received by the 
Cr e dit Inion ift conjunction with such 
loan is tie4 te the profit ef the busin e ss 
ef commercial endeavor fef vs'hich the 
loan is mad e . 
ff> Lffective Date. 
f+f lliis Rul e is e ffect iv e as ef Januaiy 4-r 
19SS. Oft aft4 aftef tf«t tlater a North 
Carolina cr e dit union may mak e member 
business loans only after adopting aft4 
implementing w ritten loan policies as fe- 
quired hy this Rule. AH- member busm e ss 
loans made eft ef after that dat e mu '. t he 
ift fttfl compliance wtth thts Rul e . 
(^ Oft ef before Jimuan T U^SS, a North 
Carolina credit union must notify the 
North Carolina Credit L nion iVdminis 
trator. ift writing, ef afty outstanding 
member business , loans made pnor te that 
date that de ftet satisfy the requirement 
ef tffts Rule. 
(d) Member Business Loans. 
( 1) Definitions. 

(A) Member business loans mean any loan, 
line of credit, or letter of credit, the pro- 
ceeds ot^^ which will be used for a com- 
mercial, corporate, business, investment 
propert\ or \enture. or agriculture pur- 
pose, except that the foHowinu shall not 
be considered member business loans for 
purposes of this Section: 
(i_[ A loan or loans fullv secured bv a lien 
on a one to four famiK dwellinu that is 
the member's primary residence. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



1110 



PROPOSED RULES 



(ii) A loan that is fully secured by shares 
in the credit union or deposits in other 
financial institutions. 

dii) A loan meetinsj the general definition 
of member business loans under Sub- 
parauaph (d)( 1)(A) of this Rule, and, 
made to a borrower or an associated 
member [as defined m Subparauraph 
(d)( 1 )(C) of thus Rule|. which, when 
added to other such loans to the bor- 
rower or associated member, is less than 
twentv-five thousand dollars (S25,QOO). 

(iv) A loan, the repa\ment of which is 
fully insured or fully guaranteed by, or 
where there is an ad\ance commitment 
to purchase in fuU by^ any agency of the 
federal goyemment or of a state or any 
of Its political subdivisions. 

(v) A loan granted by a corporate credit 
union operating under the provisions 
of the North (Carolina General Statutes 
to another credit union. 



(B) Reserves means resen.e fund, undivided 
earnings, current earnings, and excludes 
the .Mlowance for loan I osses. 

(C) Associated .Member me^ms any mem- 
ber with a shared ownership. in\estment 
or other pecuniar\ interest in a business 
or commercial endeavor with the bor- 



( D ) Immediate Family Member means a 
spouse, or other family member living in 
the same household. 

(H) Loan-to-\alue ( L TV) ratio means the 
quotient of the aggregate amount of all 
sums borrowed from all sources on an 
item o[ collateral di\idcd by the market 
\alue of the collateral used to secure the 



(F) Construction or development loan 
means a financing arrangement for the 
purpose of acciuisition of properly or 
rights to property including land or struc- 
tures with the intent of con\ersion into 
income-producing property including res- 
idential hoiismg tor rental or s^de, com- 
mercial, or industnal use, or a similar use. 
(2) Requirements. .Member business loans, 
as defined m Subparagraph (d)( 1 ) of this 
Rule may be made by credit unions onl\' 
in accordance with the applicable pro- 
Msions of Paragraphs (a) ihm (c| of this 
Rule and the following additional re- 



quirements: 
(A) Wntten 



loan policies. 



The Board of 



Directors must adopt specific business 
l(Kin policies and re\iew them at least an- 



nually. I'he policies shall, at a minimum, 

address the following: 

(i| Types of business loans that will be 

made; 
(ii) Fhe credit union's trade area for 

business loans; 



(iii) Maximum amount of credit union 



assets, in relation to reserves, that wiU 
he invested in business loans: 



(iv) Maximum amount of credit union 



assets, in relation to reser\'es, that wiU 
be invested in a given category or type 
of business loan; 
(v) .Maximum amount of credit union 



assets, m relation to reserves, that will 
be loaned to any one member or group 
of associated members, subject to Sub- 
paragraph (d)(2)(C)(i) of this Rule: 
(vi) Quahfications and experience of per- 
sonnel invoked in making and admin- 



istering business loans with a minimum 



of two years direct expenence with this 
type of lending: 

(vii) Anahsis of the ability of the bor- 
rower to repay the loan; 

(viii) Documentation supporting each 



request for an extension of credit or an 
increase in an existing loan or line of 
credit shall (except where the Board of 
I^irectors fmds that such documenta- 



tion requirements are not generaUv 
available for a particular type of busi- 
ness loan and states the reasons for 
those findings in the credit union's 



written policies) include the following 
balance sheet, cash flow analysis, in- 
come statement, tax data; leveraging; 



comparison with industry averages: re- 
ceipt and penodic updating of financial 



statements and other documentation 
including tax returns 



(ix) Collateral requirements, mcludmg 



loan-to-\alue ratios: appraisal, title 
search and insurance requirements 



steps to be taken to secure vanous types 



of collateral: and how often the \alue 



and marketability of collateral is reeval- 
uated; 

(x) Appropriate Interest rates and matu- 
ntics of business loans; 

(xi) 



1 oan monitonng. 



follow-up pnK'edures. 



and 

including co 

lection procedures: 
(xii) I'nnision for penodic disclosure to 
the credit union s members of the 
number and aggregate dollar amount 
of member business loans: 



//// 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



I 



PROPOSED RULES 



(xiii) Idcntirication, by position, of those 
senior management employees prohib- 
ited by Subpara,izraph(h )( 3 ) of this Rule 
from receiving member business loans. 
(B) Other policies. The following mini- 
mum limits and policies shall also be es- 
tablished in writing and reviewed at least 
annually for loans granted under this Sec- 
tion: 

(i) Loans shall be granted on a fully se- 
cured basis by collateral as follows: 

(I) Second lien for L IV ratios of u£ 
to 70 percent; 

(II) lirst lien for LTV ratios of up to 
SO percent; 

(III) L'irst lien with an LTV ratio in 
excess of SO percent shall be granted 
only where the value in excess of 80 
percent is cosered through acquisi- 
tion of private mortgage, or equiv- 
alent type insurance provided by an 
insurer acceptable to the credit union 
or insurance or guarantees by or 
subject to advance commitment to 
purchase b\'. an agency of the federal 
go\eniment or of a state or any of its 
political subdivisions, and in no event 
shall the LI V ratio exceed 95 per- 
cent; 

(ii) Loans shall not be granted without 
the personal liability and guarantees of 
the principals (natural person members ) 
except where the borrower is a not-for- 
protlt organization as defined by the 
Internal Re\enue Sers'ice (,'ode (26 
L.S.C. 50 1|; 



(iii) All loans to non-natural persons, 
except to other credit unions, must be 
secured as required in Chapter 
54-109.27 of the North Carolina Gen- 
eral Statutes. 
(C) Loan limits. 

(i) I .oans to one borrower. L'nless a 
greater amount is appro\ed bv the Ad- 
ministrator, the aggregate amount of 
outstanding member business loans to 
any one member or group of associated 
members shall not exceed 15 percent of 
the credit union's reserves (less the Al- 
lowance for Loan 1 osses account), or 
se\entv five thousand dollars (5.75. 000) 
whiche\er ij^ higher. ]f an\ portion of 
a member business loan is secured by 
shares in the credit union, or deposits 
in another iinancial institution, or fully 
or partially insured or guaranteed bv. 
or subject to an ad\ance commitment 
to purchase bv, an\' agency of the fed- 



eral government or of a state or any of 
its political suhdnisions. such portion 
shall not be calculated in determining 
the 15 percent limit. 
(ii) Lxceptions. Credit unions seeking 
an exception from the limits of Sub- 
paragraph (d)(2)(C)(i) or (d)(.^) of this 
Rule must must present the .Adminis- 
trator of Credit Unions with, at a mini- 
mum; the higher limit sought; an 
explanation of the need by the members 
to raise the limit and ability of the credit 
union to manage this actisitv: an anal- 
ysis of the credit union's prior experi- 
ence making member business loans; 
and a copy of its business lending pol- 
icy. The analysis of credit union expe- 
rience in making member business 
loans shall document the history of loan 
losses, loan deling uenc\', volume and 
cyclical or seasonal patterns, diversih- 
cation. concentrations of credit to one 
borrower or group of associated bor- 
rowers in excess of _1_5 percent of re^ 
serves (less the AIlov\dnce for Loan 



Losses account), underwriting standards 
and practices, types of loans grouped 
by purpose and collateral and qualifica- 
tions of personnel responsible for 
undcrwnting and administering member 
business loans. The credit union must 
ha\e written approval of the .\dininis- 
trator of Credit I nions to e\ceed the 
limitations contained in this Rule. 



(ui) Maturity. Member business loans 
shall be granted lor penods consistent 



with 



the purpose. 



secunty. 



creditworthiness of the borrower and 
sound lending policies, 
(iv) .Monitonng requirement. Credit 
unions with member business loans in 
excess of 100 percent of reser\es (less 
the Allowance for I oan 1 cesses ac- 
count) shall submit the following infor- 



malion regarding member business 
loans to the Administrator on a quar- 
terly basis: the aggregate total of loans 
outstanding; the amount of loans de- 
linquent in excess of 30 da\s: the bal- 
ance of the allowance tor member 



business loan losses: the aggregate total 
of all concentrations o[ credit to one 
borrower or group of associated bor- 
rowers in excess of _1_5 percent o[ re- 
serves (less the .\llowance lor 1 oan 
1 osses account): the total number and 
aiTHHint of all construction, develop- 
ment or speculati\'e loans: and an\' 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



1112 



PROPOSED RULES 



other infoimation pcrtiriL-nt to the safe 
and sound condition ot the member 
bu^ine:ss loan portfolio. 
(D) Allowance for loan losses. 

(il The determination whether a member 
business loan will be classified as sub- 



standard. doubtful, or loss, lor purposes 
of the \aluation allowance for loan 
losses, will rel\' on factors not limjted 
the loan. 



Non- 



to the delinquency o 

delinquent loans may be classified de- 
pending on an e\aluation ot 1 actors, 
mcludinu but not limited to. the ade- 
quac\' ot anahsis and documentation, 
(lil Loans classified shall be reser.ed as 
follows: 



(ll Substandard loans at ten percent 
of outstanding amount unless other 
factors (e.g.. histor\ ot such loans at 
the Credit Lnion ) indicate a greater 
or lesser amount is appropnate. 
Loans classified as substandard loans 
are inadequately protected b\ the 
current sound worth and pa\mg ca- 
pacity of the obli^-jor or of the collat- 
eral pledged. U any. I oans classilied 
must ha\e a well-det'ined weakness 
or weaknesses that jeopardize the 
liquidation of the debt. fhey are 
characten/.ed by the distinct possibil- 
ity that the Credit I'nion will sustain 
some loss if the deticiencies are not 
corrected. I oss potential, while ex- 
isting in the aggregate amount of 
substandard loan>. does not ha\'e to 
exist in mdnidual loans classilied 
substandard 

(III Doubtful loans at 5^ percent of 
outstanding amount. I oans classi- 
fied as doubtful loans ha\e aU the 
weaknesses inherent in ones classilied 
substandard, with the added charac- 
tenstic that the weaknesses make 
collection or liquidation m full, on 
the basis of currently existing facts. 



conditions, and \alues. higlih' ques- 
tionable and improbable. 1 he pos- 
sibilitN of loss is extremeU' high, but 
because o{_ certain important and 
reasonably specific pending factors 
which ma\ work to the ad\antage 
trengthening of the loan its 

as an estimated loss is 

deterred until its more exact status 



and 

classification 



may be determined 
include 



Fending factors 



proposed merger, acquisi- 
tion, or liquidation actions, capital 
injection, pertecting liens on addi- 



(3i 



tional collateral, and refinancing 
plans. 
(Ill) Loss loans at 100 percent of out- 
standing amount. I oans classitled 
as loss loans are considered un- 
collectible and of such little \-alue that 
their continuance as loans is not 
warranted. This classillcation does 
not necessanly mean that the loan 
has absolutely no reco\-erv or sahage 
\alue. but rather h is not practical or 
desirable to defer wntmg olf this bas- 
ically worthless asset c\en though 
partial reco\erv may occur in the fu- 
ture^ 

Construction and de\elopment lending. 

I oans granted under this Section to fi- 



nance the construction or de\elopment of 
commercial or residential property shall 
be subject to the following additional 
pro\isions: 
(Ai "I he aggregate of all such loans, ex- 
cluding an\" portion of a loan secured by 
shares in the credit union, or deposits in 

21 
or 



another financia 



parti 



illy 



institution, or full\- 

insured or guaranteed by. 



subject to an ad\ance comniitment to 
purchase bv. any agenc\ of the federal 
C}o\'emment or of a State or any of its 
political subdn isions. shall not exceed 15 
percent of reserves (less the /VUowance for 
Loan Losses account): 

(B) "Lhe borrower shall haye a minimum 
of 35 percent equity interest m the project 
being tinanced: 

(C) Lunds for such projects shall be re- 
leased following on-site mspections b\ in- 
dependent, qualilled personnel in 
accordance with a preappro\ed draw 
schedule 



(4) Prohibitions. 

(A) Senior management emplosees. A 
credit umon ma\" not make member busi- 
ness loans to the followmg: 
(i) An\ member ol the Board of Direc- 



tors who 1^ compensated as such: 
(lil 1 he credit union s chief executi\'e of- 
ficer (t\picall\ this indiMdual holds the 
title of President or 

Treasurer Manager): 
(ui) .\n\ assistant chief exccuti\'c otTicers 
(e.g.. .Assistant President. \'ice- 



President or 

Ireasurer Manager): 



Assistant 



(i\) Lhe chief financial ofllcer (Comp- 
troller): 

(\-| Any associated member or immediate 
family member oi the senior manage- 



IIL^ 



6:16 yORTH CAROLL\A REGISTER Sovembcr 15, 1991 



PROPOSED RULES 



ment cmplo\ees listed in Subpara- 
graphs (d)(4)lA)(i) thru (iv) of this 
Rule. 
(B) Fquitv kickers joint ventures. A credit 
union shaU not irrant a member business 
loan where a portion of the amount of 
income to be received by the credit union 
in conjunction with such loan is tied to 
the profit or sale of the business or com- 
mercial endeavor lor which the loan is 
made. 
(5) Recordkeeping. All loans, lines of credit, 
or letters of credit, the proceeds of which 
will be used for a commercial, corporate, 
business, investment property or venture, 
or aaiculture purpose, shall be separately 
identified in the records of the credit union 
and reported as such in financial and sta- 
tistical reports required by the .Vdminis- 
trator. 

Statutory Authority G.S. 54-109.12: 

54-109.21(25): 54-I09.7S; Federal Regulation 
NCUA '41.3. 

TITLE 10 - DEPARTMENT OF HUMAN 
RESOURCES 



I\ otice is hereby gWen in accordance with G.S. 
I50B-2I.2 that the Department of Human 
Resources Office of the Secretary intends to 
amend rule(sj cited as 10 SCAC IC .0603. 

1 he proposed effective date of this action is 
February: /. 1992^ 

Instructions on how to demand a public hearing 
(must be requested in writing within 15 days of 
notice): Public hearing may be demanded in 
writing to Steven P. Rader. General Counsel, 101 
Blair Drive, Raleigh, SC 2'' 603 by November 30, 
1991. 

IXeason for Proposed .\ ction: To establish cri- 
teria for reduction of disallowed costs to local 
Human Resources agencies. 



Co 



^.otnment Procedures: Written comments 
.should be submitted to Ste\-en P. Rader, General 
Counsel, 101 Blair Drhe, Raleigh, \C 2^603 by 
December 15, 1991. 

CH VF'I KR 1 - DKPARIMKNTAL Rl lES 
SLBCIIAPTKR IC - PFRSONNEL 



SECTION .0600 - \ 10L.\TI0>S OK 

PERSONNEL RULES AND REGLL.VTIONS BY 

LOCAL HL^L\N RESOURCES AGENCIES 

.0603 WITHDRAWAL 

(a) All personnel funds concerning salaries and 
fnnge benefits whether state or federal provided 
by or through the Department of Human Re- 
sources which are associated with the position(s) 
declared to be out-of-compliance will be perma- 
nently withheld or withdrawn from the agency 
from the beginning date of the non-compliance 
until the date of notice of non-compliance. The 
originating agency will be advised that the situ- 
ation must be rectified within 60 calendar days 
from the date of notice of non-compliance. All 
state or federal personnel funding for the affected 
position(s) also will be permanently withheld for 
that portion of the 60-day period in which the 
matter is unresolved and until the matter is de- 
clared to be m compliance by the regional per- 
sonnel director. 

(b) If the situation is not corrected in accord 
with applicable personnel and fiscal requirements 
by the end of the 60-day period, the appropriate 
program division director will declare the agency 
"out-of-comphance". An agency so declared vviU 
be demed aU state and federal personnel funds 
provided by or through the Department of Hu- 
man Resources for the full period during which 
the agcncN' is in "out-of-comphance" status, fhe 
declaration will be rescinded by the responsible 
program division director when the proposed re- 
solution is certified consistent with the apphcable 
state personnel policy and rules by the Director, 
Division of Personnel Management Services. 

(c) The Secretary of the Department of Human 
Resources may reduce the amount of disallowed 
costs to be repaid where clerical or administrative 
errors ha\e created the out-of-compliance. rather 
than situations in\ol\iniz qualifications or certif- 
ications of personnel to peribnn assigned tasks. 

Statutory Authority G.S. 143B-139.I. 

TITLE II - DEPARIMENT OF 
INSURANCE 



No 



otice is hereby gti'en in accordance with G.S. 
150B-21 .2 that the N.C. Department of Insurance 
intends to amend rulefs) cited as II \C.iC 12 
.0548. .0SI5 - .0816, .OSIS - .0822. .0824 - .0330. 
.0834; adopt rule(s) cited as II NC.AC 12 .0835 
- .0838; and repeal ndeis) cited as II SCAC 12 
.0823. .0831 - .0833. 



6:16 NORTH CAROLIiSA REGISTER November /5. 1991 



UN 



PROPOSED RULES 



1 he proposed effective date of this action is 
Febr-uan I. 1992'.' 

1 he public hearing will be conducted at 10:00 
a.m. on December 5, 1991 at the Dobbs Building, 
3rd Floor Hearing Room. 430 .\. Salisbwy Street. 
Raleigh, .\.C. 2''6II. 

Jxeason for Proposed .Action: To conform with 
recent legislation enacted by Congress. 

(^ omment Procedures: Written comments may 
be sent to Laurie Saxton. P.O. Box 263S7, 
Raleigh. \.C. 2^6 IL Oral presentations may be 
made at the public hearing. .Anyone having 
questions should call Laurie Saxion at (919j 
733-5060, or Ellen Sprenkel at i 919) 733-4529. 

Jtliditor's .\ote: These Rules have been filed as 
tcmporaiy rules effective October 16. 1991 for a 
period of 180 days to expire on .April 13, 1992. 

CHAPTKR 12 - LIFE AND HEALTH DIVISION 

SECTION .0500 - ACCIDENT AND HEALTH: 
GENERAL NATLRE 

.0548 INSLRANCE FOR MEDICARE ELIGIBLE 

(a) Direct response insurers pro\idmg accident 
and health insurance to persons ehuble tor 
Medicare bv rca^^^ln of a^e shall: \ ach ini ' Ur e r 
• jhall pro' . id i j t*v titt prO"pL ' cti' . L ' purcha '' OrL' i »f *e- 
cidL'nt ttftti ht-'alth inL^uranco who afe oUgiblc fe+ 
mudicaro hy reu^on e4' »** e* ssho currtintly Fe- 
ire+v^ M e dicar e » copy t4 At* curtL ' nt ijdilion el 
thr» NAIC 111 IS Guidt' tt> H e alth hv . urancL' fof 
Foopk' V i ith MudicarL' »«4 (4*e North Curolina 
Buyer J Guide' k+ I lealth Insurance aft4 Medicar e 
aft4 Medicaid at- Ae boginninLi »f stfVr- naloi . pre' - : . 
ontation. -fth* Pn' . atL' ht ' : . uranc>? Checklist con 
tettte4 m At> NAIC I IHS Qm4^ 4wti ^ prop^ ' rly 
compl e ted pnor te- tfee time t^ pro ' jpecti>c' jhh^ 
chaser i* provided aft application fe* a policy. 

(44 Facli in ' Hirancij agency, agent. brolccT. aft4 
producer ir4 record l ' IkiII certify Arrf (4*e proi . pec 
?+rr^ purcluiL i er ba* recened a > ' Orth Carolina 
Bu' ie r ;. Cjuid e s^ a prop e rlv completed 
NAIC mis Guide. ¥fe certification 4taU ^ 
submitted ' . viih t+h* application t+* t4te insurer. 

KH In^ ' Urers t4w4 de- wt+t- market throuuji aft 
agent aw exempt from Paragraphs fa-f aft4 (4h e4 
t+tfs Rule aft4 sIkiU pro' i ide at- (4*1* time t4" policy 
dehi i ep t a North Carolina Buyer's Cjuide aft4 a 
N.MC 1 II IS Guide vsith t4K» Pn' . ate In ' . ' Uranc e 
Cheekli '. t completed fof their policy, provided 



(1) guarantee to the policyholder an uncondi- 
tional 30 day right to return the policy for 
a full refund of prenaium; and 

(2) aiert t4h* prospective policyholder, - 
policN holders, in ad\ertisements or direct 
mail sohcitatioiis. of b» e* be* their right 
to obtain a copy of tfee North Carolina 
Buyoro Guide aft4 the NxAIC-HHS Guide 
to Health Insurance for People with 
Medicare prior to sale. 

(-4+ Fach insurer '. hall pro' i ide a North Carolina 
Buyer s Guide te- Health Insurance ktft^ Medicaro 
im^ Medicaid aft4 t^ NAIC I HIS Guide te 
Health In '. urance fof P e opl e with .Medicare upon 
request. 

(b) (^ Each insurer AU insurers pro\'iding ac- 
cident and health insurance to persons eligible for 
.Medicare bv reason of age shall annually report 
to the Commissioner the number of written 
complaints or mquines rf- receives received from 
iH accident aft4 health msurance these 
poUcyholders who are eligible for Medicare. 

(-f^ This Regulation shall fte+ apply to group 
accident ^tfr^ h e alth policies a* defined » GtSt 
5 S J .'^ 1 1 t*f k* conversion coveragoo et privileges 
held by aft insured. 

fg) ?4«» 4-^ (4ay^ nght k* r e turn t4ie pohcy fef a 
fttH- refund »f premium t*f t4H* ^ 4av right k»- Fe- 
t-t*Fft w-i prescribed » Paragraph fcHr tf benefits aw 
fte+ usc ' d. shall begin with tl*i* delivenr »f tbe 
policy ef ©f a properly completed N MC HHS 
()uid e . v i hich e ser i-^ lat e r. 

Statutory Authority G.S. 5S-2-40: 58-2-190: 
58-2-195; 58-3-100; 58-3-II5: 58-3-150; 58-51-1: 
58-51-15; 58-51-60; 58-51-85; 58-51-95; 58-54-1: 
58-63-15; 58-65-1: 58-65-4; 58-65-105. 

SECTION .0800 - MEDIC.VRE SLPPLE.MENT 
INSLRANCE 

.0815 PLRPOSE AND DEFINITIONS 

fa) The purpose of these Rules this Section is 
to provide for the reasonable standardization of 
coverage and simplification of terms and benefits 
of Medicare Supplement Policies: supplement 
policies: to facilitate pubhc understanding and 
comparison of such policies; to eliminate pro- 
\isions contained in such policies which may be 
misleadmg or confusing in connection with the 
purchase of such policies or with the settlement 
of claims: and to provide for fuU disclosures in 
the sale of accident and sickness insurance cov- 
erages to persons eligible for Medicare, hy Fea- 

^^^^^ ^^i ^^^^^^ 

(b) For purposes of this Section: 



II 15 



6:16 SORTH CAROLIS.A REGISTER Sovember 15, 1991 



PROPOSED RULES 



01 

01 



Certificate Form" means the form on 



which the certificate is dehvered or issued 
for dcliverv' bv the issuer. 



Ill 



"Issuer" includes an insurance company, 
fraternal benefit society, hospital or med- 
ical senice plan, health maintenance or- 
ganization, or any other entity delixcriniz 
or issuing for deliycry in this State Medi- 
care supplement policies or certificates. 
''Policy torm" means the form on which 
the policy is deliyered or issued for deliy- 
er\' by the issuer. 



Statutory Authority G.S. 5S-2-40; 5S-S4-I0; 
58-54-15; 5S-54-25. 

.0816 .\PPI.IC.\BILITY AND SCOPE 

(a) Except as otherwise specifically provided in 
11 NCAC 12 .0820, U .0821. 12 .0822 and « 
Mi^ n .0829. this Section applies to: 

( 1 ) rVll .Medicare SuppL ' iriL ' nt Polici e s aft4 
aubocribL'r contructo supplement policies 
delivered or issued for delivery' m this state 
on or after the effective date of this Sec- 
tion, and 

(2) All certificates issued under group Medi- 
care Supplomont Policiuo Bt- liubocribor 
contracts, supplement policies, which cer- 
tificates have been delivered or issued for 
deliver>' in this state. 

(b) This Section does not apply to a policy or 
contract of one or more employers or labor or- 
ganizations, or of the trustees of a fund estab- 
lished by one or more employers or labor 
organizations, or combination thereof, for em- 
ployees or former employees, or a combination 
thereof or for members, or a combination 
thereof, of the labor organizations. 

Stdtuioiy Authority G.S. 5S-2-40: 5S-54-5. 

.0818 POLICY DEFINITIONS .\NI) TERMS 

No insuranco poHcy or subscnbcr contract cer- 
tificate may be ad\'ertised, solicited or issued for 
delivcrv' in this state as a Medicare SuppR'nicnt 
Policy supplement policy or certificate unless 
such policy or subscnbor contract certificate 
contains definitions or tenns ' . vhich that conform 
to the requirements of this Section. 
(1) "Accident", "Accidental Injury", or "Acci- 
dental Means" shaU be defined to employ 
"result" language and shall not include 
words which establish an accidental means 
test or use words such as "external, violent, 
visible wounds" or similar words of de- 
scription or characterization, 
(a) The definition shall not .be more restrictive 
than the following: "Injurv' or injuries for 



which benefits are provided means acci- 
dental bodily injury sustained by the in- 
sured person which is the direct result of 
an accident, independent of disease or 
bodily infirmity or any other cause, and 
occurs while insurance coverage is in 
force." 
(bj Such definition may pro\ide that injuries 
shall not include injuries for which bene- 
fits are provided or a\'ailable under any 
workers' compensation, employer's liabil- 
ity or sunilar law, unless proliibited by 
law. 

(2) "Benefit Period" or "Medicare Benefit Pe- 
riod" shall not be defined as more ro ' . ' tricti' . c' 
rcstricti\ely than as Aat- defined in the 
Medicare program. 

(3) "Convalescent Nursing Home", "Extended 
Care Facility", or "Skilled Nursing Facility" 
shaU not be defined i» relation to i4* status, 
facilities »«4 as ailablo scp i icco. more 
restrictiveh than as defined in the \ledicare 
program. 

fa-^ A definition ©f such hom e ©f facility shaU 
Hot- be more restncti' i o than eHW requiring 

(i^ be operated pursuant to \swi 

ft*^ be apprdod (of payment ef Medicaro 

bonofits »f be c[uulified to rocei' i e such 

approsul, if so requested; 
{mj be pnmarily engaged m providing, ti* 

addition to room »ft4 board acctunino 

dations, skilled nursing eefe under tfee 

supenision &i a tJolv liceniied physician: 
(iv^ provid e continuous 34 hours a day- 

nursing sonice by e* under tlte super 

vision ef a registered graduate ) profes ' ion 

nurse ( R N . ) ; a«4 
f>r4 maintain a daily modicul record »f euch 

pati e nt. 
(-b) 4-kii definition rf such home »f facility 

H»y provid e t4*a+ such term Hot- be inclu 

(+) aoy hom e , facility of part th e r e of used 
pnmanh i ft+f w*rH 

eaf* ef drug addicts »f alcoholics; t>f 

till* CT rTtTTTTt? I'r I LlC' 1 1 1 1 V t." it 1 1 1.1 1 111 U ''(JU lO I ri It? 

eafe aft4 treatment rf mental diseases t*f 
disorders. »f custodicd ef educational care. 

(4) "Health Care Expenses" means expenses 
of health maintenance organizations associ- 
ated with the delivery of health care services, 
which expenses are analogous to incurred 
losses of insurers. Such expenses shall not 
include: 

(a) home office and overhead costs; 

(b) ad\ertising costs; 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



1116 



PROPOSED RULES 



(c) commissions and other acquisition costs; 

(d| taxes; 

(c) capital costs; 

(f) administrative costs; ef and 

(g) claims processing costs. 

(5) "Hospital" may he defined in relation to its 
status, facilities and available ser\'ices or to 
reflect its accreditation by the Joint Com- 
mission on Accreditation of Hospitals, but 
(*> -14«» definition »f At^ turm "hui . pital" 
i i hall not be more ro i' tricti' i L * restrictivelv 
than t*«# r e quiring {+»*• A*^ ho '. pital: as de- 
fined m the Medicare program. 
(i^ t>T» »«• iniititution oporatud purouant te 

III Vt ,' ctrrtT 

fii^ h^ primarily aft4 continuously engaged 
irft prosiding et operating, eith e r »» ite 
premiL ' e i ; . t+f h* Facdiliu 'i available V«- the 
ho ' . i pital t+ff a prearranged bar . i '' aR4 under 
Ae '. uperxi ' -iion ef a -^rf «4' duly licenced 
phy . ician - :. medical, diagnostic stfr^ major 
surgical facilities fof f4t<* medical eafe aft4 
treatment trf ^ek- (*f injured per ;. on! i »«■ aft 
inpatient biisi ' : . fof ' ■ vhich charge? is mado; 

^m^ provide 34 hour nurcing sorvico W ef 
under tht* '. uper i ir . ion »f registered gradu 
ate prot"e ;i-' ional nurs e s (M.N.r . ). 
ffe4 4-he definition (-4 t+» tenn hospital" may 

.~ t ■ 1 f , 1 f V-. - ■ t ■ 1 1 . -K t .ir-j-i-i till 'ill n. ^ t BA 1 Tit'l \ 1 t'i\r>^ 

J* I U T V 1 1 ILIl -"J I. 1 1 IV. I 111 rTTTTTTT nTTT L.'V IIIV-ITJ Jl T \_' 

»ff 

fi^ cons ale '. cent homes, convalescent, fest 

ef nursmg facilities: Bf 
(4i^ I'acilitie '. primanh i affording custodial, 

e ducational Bf rehabilitation care; ef 
f«i4 facilities fe* t4*e aged, drug addicts ef 

alcoholics; Bf 
(+v^ aftv militar T ef veterans hospital e* 
soldiers home ef afty hospital contracted 
fop t*f operated by- aftv national govern 
ment Bf agency thereof fof the treatment 
t4 members t»+ ex members ef the armed 
forces . , e.xcept fof sen ices render e d Bft aft 
e mergency basis where a legal liability e?t- 
i*4^ Wtf charges made t» the indi' i iduid fo+ 
such serv ices. 

"Mediciire" shall be defined in the policy 
and certillcate. Medicare may be substan- 
tialK' defined as "The Health Insurance for 
the Aged Act, litle XVIIl of the Social Se- 
curity .\mendments of 1965 as Then Con- 
stituted or Later Amended", or "Title I, Part 
I of Public Law 89-97, as Enacted by the 
Eighty-Ninth Congress of the United States 
of America and popularly known as the 
Health Insurance for the .Aged Act, as then 
constituted and anv later amendments or 



(6) 



substitutes thereof, or words of similar im- 
port. 

(7) ".Medicare Eligible Expenses" shall mean 
h e alth safe expenses of the kinds covered by 
Medicare, to the extent recognized as rea- 
sonable and medically necessary by Medi- 
care. Payment »f benefits by insurers fep 
Medicar e eligible exp e ns e s may be condi 
tioned upt)ii the ^. ame Bf letrt- restrictive pay 
ment conditions, including detenninationa 
»f medical n e cessity *& afe applicable te 
.Medicare claims. 

fSy) "Mental t*f Nep i ous Disorders" shall set 
be defined mor e restriotivoly than a liefi- 
nition including neurosis, ps . ychoneurosio, 
P 'i ; i chopathy, psychosis. »f mental »f emo 
tioiuil diseaso »f disorder »f aftv kind. 

f^ "Nurses" may be defmed se tb«t tbe de- 
scription el nurse » restricted tB a type »f 
nur '- e. such *s Registered Graduate Profoo 
sional Nurso ( R . N . ) , a 1 icen '^ ed Practical 
Nurse (1 .P.N.), t*f a licensed ^ ocational 
Nurse (L.V.N.). U tbe words "nurso", 
"trained nurse", e+ "registered nurse" aj© 
used vv ithout specific instruction, then tbe 
(*«? trf such tenns requires the insurer te 
recognij' e the servic e s t+f afty individual wbe 
qualified under such t e nninology tft accord 
ance with the applicabl e s . talutes 8+ admin 
istrative rules e+" the lic e nsing ef r e gistrv ' 
board b4 the slat e . 

(S) f4-U} 'T'lnsician" may shall not be defmed 
by including words such a^ 'duly qualified 
ph; i sician" e+ "duly licensed physician". 
4-be t»e el such t e rms requires aft insurer te 
recognij'e asd t» accept, te the e xtent ef its 
obligation under tbe ccuitruct, aW providers 
ef medical eafe aftd treatment vs hen such 
sen ices afe within the scope et the provid 
ef^i hcensed authonly aftd afe pros ided pftf- 
suant tft applicable lav i s. more rcstnctnclv 
than as defined in the Medicare prc^ijam. 

(*-")) (444 ■Sickness" shaU not be defined to be 
more restncti\'e than the following: "Sick- 
ness means sickness illness or disease ot an 
insured person which frrst manifests itself 
after the effective date of insurance and while 
the insurance is in force". The defmition 
may be further modified to exclude sick- 
nesses or diseases for which benefits are 
provided under any workers' compensation, 
occupational disease, employer's liability or 
similar law. 

Statuton; Authority G.S. 5S-2-40; 5S-54-5: 
5.^-54-/0: 5S-54-/ 5. 

.0819 POLICY PROMSIONS 



77/7 



6." 76 SORTH CAROLINA REGISTER November L\ 1 99 1 



PROPOSED RULES 



(a) Except for permitted pre-existin.g condition 
clauses as descnbed in 11 NCAC 12 .0820(1 )(a) 
and n_ NC'AC J_2 .0835( l)(a), no -Ne- inourunco 
policy or L . ubi: . onhur contract certificate may be 
advertised, solicited or issued for delivery in this 
state as a Medicare Supplomcnt I'olicy supple- 
ment policN' if such policN or certificate contains 
limitations or exclusions on coverage that are 
more restrictive than those of Medicare. &**b- 
scribur contract limits ef cxcludt'L i covorugo by 
type »f illnooG. accident , troatmont &f mudicaJ 
condition, exc e pt m follov .'' , . : 

(44 foot erw* m connocticm with oomo, 
calluf ia o, flrtt- fo«4T fallen arche '. . weak feet7 
chronic fgn-vt- r . train, e* oymptomatic com 
plaint ' j »i t4it» fe*4t 

i*ft4 drug addiction: 
(4) illnjfl '. , treatment »f medical condition 
ari ii ing e+rt efe 
(A)- Vr^af »f ae4- ©f waf (whether declared »f 
undeclared): participation ift a felony, ho* 
ef iiiL i urrection: Venice wt the armed force o 
Bf unitL . auxiliary thereto: 
f8-> i . uicide ( r . ane «* in '. iine). attempted 



ei4# e* Lnlenlionally ijelf inflicted iiijuri : 
fG^ aviation: 

(-H co '. metic i^urgeny. except ti»t- "coiim e tic 
r . urgeP r " '. hall He4- include reconotaictise 
surgeP i ' . ' ■ hen such sen . ice i* incidental te- 
€>F follows surgeiy resulting from trauma. 
infection t*f other dis e as e s t*f the in' i oKed 
part : 

(4i eafe j» connection ' I ' l ith t4+i* detection t*ft4 
correction 1*¥ manual t+f mechanical 
means (4 structural imbalance, distortion, 
e+ subluxation h* rt» human body fof 
purposes e4~ remosuig ner' .e interference 
aft4 t4+e effect thereof where such inter 
ference i* tbe result trf »f related to- tfe- 
tortion. mi '. alignment ef subluxation »f 
€>f tft (4*r* ' ■ ertebral column: 

(4) treatment pro>id e d ift a gosemmental 
hospital: benefits pro' i ided under .Medi 
safe »f other governmental program fe?r- 
eef4 Medicaid), aey state ef federal 
' ■ vorkers' comp e nsation, employer's liabil 
rty af occupational disease law^ senices 
rendered by employees (4 ho 'i pitals. labo 
ratoiies ©f other mstilutions: services pi*f- 
fonned by a member »f ttw co' . ered 
perstm s immediate family aft4 r . er' i ices fof 
' I ' l hich ft» charge ts normally made h* the 
absence ©f insurance: 

f^ dental eafe **f treatment: 

fS) eye glass e s, h e anng attk aft4 examination 
fof the prescription e+ fitting thereof 



fO^ fest- euros, cuotodial care, transportaticm 

aftd- routin e physical examinations: 

f+O^ terrilonal limitations out '. ide the Unit e d 

States: 

pro' i ided, howeser, supplemental policies may 

fte+ contain, wh e n issued, limitations &f exclu 

sions »f the typo enumerated m Paragraphs fa^ 
/ 1 \ / ^ > I c\ \ r^,- / 1 n \ ^r f u:.- d , ■ i ^ tr. .^t -1^,^ ^..^ ^ ^. . 

^11, \ „' ^ , y .' I , U 1 \ ' - / U 1 1 1 U J 1 L Ll 1 U I J ILl I LXi L i i 11.7 I U 

restrictive than those »f Medicare. Medicare 
Supplement Policies may e xclude coverage fe* 
afty expense ts- tbe extent ef a«y benefit availabl e 
te- the insured under .Medicare. 

(b) No Medicare Supplement Policy supple- 
ment policy or certificate may use wai\ers to ex- 
clude, limit or reduce co\erage or benefits for 
specifically named or described preexisting dis- 
eases or physical conditions. 

fe) -Phe t e nns "Medicare Supplement", 

"Medigap" aft4 words ef similar impoil shall ftot 
he used unless tbe pohcy » issued m comphanc e 
with this regulation. 

(c) (4f No Medicare Supplement Insurance 
Policy, contract supplement policy or certificate 
in force in the state shall contain benefits wliich 
duphcate benefits provided by Medicare. 

Statutory Authority G.S. 58-2-40; 58-54-10. 

.0820 MIM\rLM BKNKFIT S TAND.VRDS 

BEFORE J.VNUAR'^ 1, 1992 
No insurance policy or subscriber contract cer- 
tificate may be advertised, solicited or issued for 
dehven,' in this state as a Medicare Supplement 
Policy ' ■ ' ■ hich does set- meet supplement pohcy 
or certificate unless it meets or exceeds the fol- 
lovsing minimum standards. 1 hcse are minimum 
standards and do not preclude the inclusion of 
other provisions or benefits which are not in- 
consistent with these standards. 
(1) General Standards. The following stand- 
ards apply to Medicare Supplement Policies 
supplement policies and certificates and are 
in addition to all other requirements of this 
regulation, 
(a) A Medicare Supplement Policy may sup- 
plement policN' or certrficate shall not d e ny 
a claim exclude or limit iK'nefits for losses 
loss incurred more than six months from 
the effective date of coverage fof because 
it invohed a preexisting condition. I'he 
policy or certificate shall may not define 
a preexisting condition more restricti\'ely 
than a condition for which medical advice 
was given or treatment was recommended 
by or received from a physician within six 
months before the effective date of cover- 



6:16 NORTH CAROLINA REGISTER November 1>, 1991 



Ills 



PROPOSED RULES 



(b) A Medicare Supplomont Policy B»y sup- 
plement policy or certificate shall not 
indemnify against losses resultmg from 
sickness on a dilTerent basis than losses (hj 
resulting from accidents. 

(c) A Medicare Supplem^ ' nt Policy supple- 
ment policy or certificate shall provide 
that benefits designed to cover cost shar- 
ing amounts under Medicare will be 
changed automatically to coincide with 
any changes in the appUcable Medicare 
deductible amount and copayment per- 
centage factors. Premiums may be modi- 
fied to correspond with such changes. 

(d) A "noncancellable," "guaranteed 
renewable," or "noncancellable and guar- (i) 
anteed renewable" .Medicare Suppk ' mjnt 

Pohcv supplement policy shall not: 
(i) preside tor termination of coverage of a 
spouse solely because of the occurrence 
of an event specified for termination of 
coverage of the insured, other than the 
nonpayment of premium; or 
(ii) be cancelled or nonrenewed by the 
in! . ur <» r issuer solely on the grounds of de- 
terioration of health. 

(e) Except as authorized by the Commissioner (2) 
of this state, an insurijr issuer shall neither (a) 
cancel nor nonrenew a .Medicare Supple 

mont supplement poUcy or certificate for 
any reason other than nonpa\ment of 
premium or material misrepresentation. 

(f) If a group .Medicare Supplement int . urunco (b) 

supplement policy is temiinated by the 
group policyholder and not replaced as 
provided m Subparagraph (Jj (h) of tliis (c) 

Rule, the int i uror issuer shall offer certif- 
icate holders an indnidual Medicare Sup 
plomont supplement policy. The inr . uror 
issuer shall offer the certillcateholder at (d) 

least the following choices: 

(ij an indis'idual .Medicare Supplement 
supplement policy ' ■ vhich pro' i idoo fof 
continuation e+ t4*^ benefiti . contuinod tft 
Ai* group policy: aft4 currenth offered by 
the issuer having comparable benefits to 
those contained m the tenninated ijoup (e| 

■Medicare supplement policv: 

(ii) an indnidual .Medicare Supplement 
supplement policy which provides only 
such benefits as are required to meet the 
minimum standards as defined in 1 1 
NCAC 12 .ns35(2i. 

(g) It membership in a group is terminated, (f) 
the in Li u re r issuer shall: 

(i) offer the certiffcateholder such conver- 
sion opportunities as are described in 
Subparagraph (_h (f) of this Rule: or 



(ii) 



u) at the option of the group policyholder, 
offer the certificateholder continuation of 
co\erage under the group policy. 
If a group Medicare Supplomont supple- 
ment policy is replaced b\ another group 
.Medicare Supplement supplement policy 
purchased by the same pohc\"holder, the 
succeeding inourur issuer shall offer cover- 
age to all persons co\'ered under the old 
group pohcy on its date of termination. 
Coverage under the new group policy 
shall not result in any exclusion for pre- 
existing conditions that would ha\e been 
covered under the group policy being re- 
placed. 

Permination of a .Medicare Supplement 
Policy supplement policy or certificate 
shall be without prejudice to any contin- 
uous loss which commenced while the 
policy was in force, but the extension of 
benefits beyond the period during which 
the policy was in force may he predicated 
upon the contmuous total disabihty of the 
insured, limited to the duration of the 
policy benefit period, if any, or to pay- 
ment of the ma.ximum benefits. 

Minimum Benefit Standards. 
Coverage of Part A Medicare eligible ex- 
penses for hospitalization to the extent 
not covered by .Medicare from the 6l5t 
da_\ through the 90th day in any .Medicare 
benefit period: 

Coverage for either all or none of the 
.Medicare Part A inpatient hospital 
deductible amount; 

Coverage of Part A .Medicare eligible ex- 
penses incurred as daily hospital charges 
dunng use of .Medicare s Ufetime hospital 
inpatient resen,'e days; 
Upon exhaustion of all Medicare hospital 
inpatient coverage including the lifetime 
reser\'e days, coverage of 90 percent of all 
Medicare Part A eligible expenses for 
hospitalization not covered by Medicare 
subject to a hfetime ma.ximum benefit ot 
an additional 365 days; 
Coverage under Medicare Part A for the 
reasonable cost of the first three pmts of 
blood (or equivalent quantities of packed 
red blood cells, as defined under federal 
regulations) unless replaced in accordance 
w ith federal regulations or already paid for 
under Part B; 

Coverage for the coinsurance amount ot 
Medicare eligible e.xpenses under Part B 
regardless of hospital confinement, subject 
to a maximum calendar \ear out-of 
pocket amount equal to the Medicare Part 



1119 



6:16 .\ORTH CAROLINA REGLSTER November 15, 1991 



PROPOSED RULES 



B deductible { ' XvonXy fivo dollars ($75.00)| 
maximum b e n e fit, [one hundred dollars 
(j.in0.nQ)|. Effective January 1, 1990, 
coverage for the coinsurance amount (20 
percent) of Medicare eligible expenses for 
covered outpatient drugs used in 
immunosuppressive therapy subject to the 
Medicare deductible amount is included 
within this provision; 
(g) Effective January 1, 1990, coverage under 
Medicare Part B for the reasonable cost 
of the first three pints of blood (or equiv- 
alent quantities of packed red blood cells, 
as defined under federal regulations), un- 
less replaced in accordance with federal 
regulations or already paid for under Part 
A, subject to the Medicare deductible 
amount. 
(^ Modicar i? Eligibk* Exponser . . Medicare? eti- 
giblo oxpL'nooo iihuU mi ' un health «**» wi- 
ponocr i ©f tfee kind ' .i cosered by Medicare, te- 
A# e.xtent recognii'.ed c» rea '. onuhle by 
Medicare. Payment (4 benefitr . by in 'i urero 
fof Medicare eligibl e expenooo may be con 
ditioned upon Ae ? . am e »f lew rei . trictivo 
payment condition-: . , including detenni 

ft ■ 1 t « ."t jT . • /-» r m , 1 J « < J ' -1 1 t^^ij^j^jr^ti^^ -^ i~ ■ t *-. 1 • 
r^TTTT^TTTTT \r\ 1 1 1 ^_ TJ I t.T.1 1 I I^T,^T.r*.TT I T CTTT LLl \.' K 

te Medicar e claim ' , . . 



SialiUoiy 
58-54- 1 i. 



Auilwhiv G.S. 5S-2-40: 5S-54-I0: 



.0821 STAND.ARnS FOR CI.VrMS I'A^MKNT 

Policies ef contract ' , . An issuer shall comply with 
aH- provision '. t»f Section lS82(c)(3) of the Social 
Security Act [as enacted bv Section 4081 (b)(2)(C) 
of the Omnibus Budget Reconciliation Act of 
1987 (OBRA 1987). fP.E. 100-203)1 bv: 

(1) .Accepting a notice from a Medicare carrier 
on dually assiaied claims submitted bv 
participating physicians and suppliers as a 
claim for benefits in place of anv other 
claim tonn otherwise required and making 
a payment detennination on the basis of 
the information contained in that notice; 

(2) Notil\ing the participating physician or 
supplier and the beneficiary of the pay- 
ment determination: 

(3) Paving the participating physician or sup- 
plier directly : 

(4) furnishing, at the time of enrollment, each 
cnrollee with a card listing the policy 
name, number and a central mailing ad- 
dress to which notices from a .Med 



(5) Paving user fees for claim notices that are 
transmitted electronically or otherwise; 
and 

(6) I'roviding to the Secretary of Health and 
Human Services, at least annually, a cen- 
tral mailing address to which all claims 
may be sent bv .Medicare carriers. 

(b) Compliance with the requirements set forth 
in Paragraph (a) of this Rule must shall be certi- 
fied on the Medicare Supplement supplement 
insurance experience reporting form. 

Statutory^ Authority G.S. 58-2-40; 58-54-/5. 

.0822 LOSS RATIO STANDARDS AND 

RKH ND OR CRKDIT OF PREMIL VI 

(a) Eoss Ratio Standards: 
( 1) A .Medicare Supplement Policies shall w- 
t««* k» policyholders m- Ae ftmn ef a^ 
gregate benefits under t4*t» policy, 
supplement policy fonn or certificate fonn 
shall not be delivered or issued for delivery 
unless the policy form or certificate lonn 
can be expected, as estimated lor the en- 
tire period for which rates are computed 
to provide coverage, »» Ae basis nf tft- 
curred claims experience Bf incuned 
h e alth eafe expenses where co' i eiago » 
provided by a health maintenance organ 
ij'.ation »» a sersioe rather than h*- 
imbursement basis aft4 earned premiums 
fof such period aft4 Ht accordcmce vs ith 
accepted actuarial principles aj+d practices . : 
to return to policyholders and certificate 
holders in the fonn of aggregate benefits 
(not including anticipated refunds or 
credits) provided under the policy fonn 
or certificate fonn: 



(A) (-H At least 75 percent of the aggregate 
amount of premiums earned in the case 
of group pohcics. aft4 or 

(B) (3) At least 65 percent of the aggregate 
amount of premiums earned in the case 
of individual policies, 

calculated on the basis of incurred claims 
expenence. or incuned health care ex- 
penses where coverage is prcnided bv a 
health maintenance organization on a 
service rather than reimbursement basis. 



icare 



earner may be sent; 



and earned premiums for such period and 
in accordance with accepted actuanal 
pnnciples and practices. 
(2) All fdings of rates and rating schedules shall 
demonstrate that actual aH4 expected 
losses claims in relation to premiums 
comply yvith the requirements of this 
Section when combined with actual expe- 
rience to date, lilinsis of rate revisions 



6:16 ^ORTH CAROLINA REGISTER November 15, 1 99 1 



1120 



PROPOSED RULES 



shall also demonstrate that the anticipated 
loss ratio over the entire future penod for 
which the revised rates are computed to 
pro\ide coverage can be expected to meet 
the appropnate loss ratio standards, 
(b) Refund or (,'redit Calculation: 
( 1) An issuer shall collect and file with the 



cedures prescribed by statute of rule. The sup- 
porting documentation shall also demonstrate in 
accordance with actuarial standards of practice 
usins reasonable assumptions that the appropri- 
ate loss ratio standards can be expected to be met 
o\er the entire penod for which rates are com- 
puted. Such demonstration shall exclude active 



Commissioner bv May M of each \car the life reserves. ^-Vn expected third-vear loss ratio 



data contained in the reporting form for 
each type in a standard .Medicare supple- 
ment benelit plan. The reporting torm 
shall be in the format prescnbed bv the 
NAIC m .Appendix A of the Model Reg- 
ulation to Implement the N.MC .Medicare 
Supplement Insurance .Minimum Stand- 
ards .Model .Act, as adopted .lulv Ml I ^^) I . 
including any subsequent amendments 
and editions. A copy of this lonnat is on 
file at the North Carolina Department of 
Insurance. Copies ma\' be obtained trom 
the Department at a cost ot' two dollars 
and hftv cents (S2.5i~) each. 

(2) If on the basis of the experience as re- 
ported the benchmark ratio since incep- 
tion (ratio _}_[ exceeds the adjusted 
expenence ratio since inception (ratio 3), 
then a refund or credit calculation is re- 
quired. I he refund calculation shall be 
done on a statewide basis lor each t\pe in 
a standard .Medicare supplement benefit 
plan, lor purposes of the refund or credit 
calculation, expenence on policies issued 
within the reporting vear shall he ex- 
cluded. 

(3) A refund or credit shall be made only 
when the benchmark loss ratio exceeds 



the adjusted expenence loss ratio and the 
amount to be refunded or credited exceeds 
a de minimis le\el. Such refund shaU in- 
clude interest from the end of the calendar 
vear to the date of the refund or credit at 
a rate specified bv the Secrctar\ lA Health 
and I luman Ser\ices. but in no e\ent shall 
it be less than the a\erage rate of interest 
for I .Vweek I reasury notes. A refund or 
credit against premiums due shall be made 
bv September 30 following the expenence 
vear upon which the refund or credit is 
based, 
(c) /Annua l Filing of Premium Rates 



An 



issuer of f^ 



I: voP i' 
'olicic'L i 



L'ntitv 



providing! .Medicare 
Supplement Policiei i supplement policies and 
certificates issued in this state shall file ;mnually 
its rates, rating schedule and supporting doc- 
umentation, including ratios of incurred losses to 
earned premiums by number t*f yoaro &f policy 
duration, for appro\al bv the Commissioner in 
accordance with the filing requirements and pro- 



that IS greater than or equal to the apphcable 
percentage shaU be demonstrated for policies or 
certificates in force less than three years, dsm 
on - jtrutiiig Arri- t4- t^ m- compliance with tfe* foro 
going applicable k+wj ratio otandardo a«4 t4**(- tfee 
p e riod f»f which tW policy k, rated i* rcasonablo 
m accordunco vsith accepted uctuunol principles 

poUcy lorm ' j r ^ hull t*e deemed h^ comply ' . sith ih» 

k*^* ratio ; i tandardr i ifr 

faf fof A# mo '. t r e c e nt >ear, y*e ratio ef tfee 
incurred lo 'i'. O ' j i^ earned premium -i fof 
policieC f e* certificate ' j sv hich hasn been ift 
foroj fof three yearii t+f moro » greater 
than e* equal k» th^ applicable percent 
age^ contained tft- A*^ Section: »ft4 
fb-f y+e expected lo ' - i'. eii h* relation te premi 
HfFK over tht* entir e penod fop ' . shich tb» 
policy » rated comply s' l ith tb<* recjuiro 
mentc ef tki^ Section. Aft expected 
third year 1**« ratio ' ■ s hich kr greater than 
»f equal *«• Ae applicable percentage 4«}i 
V>e demonr . trated fo* policie - : . ef certificateo 

l\J I \.\J H. .. 1 - ' I I ILll 1 till \J\J f l^ U i LI . 

f-l^ As soon as practicable, but prior to the ef- 
fective date of enhancements in Medicare benefit 
changer . , benefits, e\ery inr . urer. health eafe sef- 
VHre f4rtft eH= other entity providing issuer of 
.Medicare Supplement iu 'i urance nt contracts 
supplement policies or certificates m this state 
shall file with the Commissioner, m accordance 
with the applicable fiUng procedures of this state: 
( 1) fa^ Appropriate premium adjustments nec- 
essary to produce loss ratios as originally 
anticipated for the current premium for 
the applicable policies or contruct -i . cer- 
tificates. Such supporting documents as 
necessary to justify the adjustment shall 
accompany the fifing. aft4 
(.A I fb-> I'Aer . ' insurer, health etm* sonic e 
f4»ft t+f other entity prosiding Medicare 
Supplement insuranc e e+ benefits te a 
resident t>f t4»s state pur s uant to Articl e 
44 &i Chapt e r ^ &f At» North Carolina 
Gen e ral Statut e s An issuer shaU make 
such premium adjustments as are neces- 
sary to produce an expected loss ratio 
under such policy or contract a* certificate 
that will conform with minimum loss ra- 
tio standards for .Medicare Supplement 



1121 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



PROPOSED RULES 



Policij ' j supplement policies, and which 
arc expected to result m a loss ratio at 
least as great as that originally anticipated 
in the rates used to produce current pre- 
miums by the in^ . uror, health cafe iiorsice 
f4a» »f othtT entity issuer for such Medi- 
care Supplem e nt Inouranco Policies) &f 
contractr i . supplement policies or certif- 
icates. No premium adjustment which 
would modify the loss ratio experience 
under the policy other than the adjust- 
ments described herein should be made 
with respect to a policy at any time other 
than upon its renewal date or anniversary 
date. 
(B) If an issuer fails to make premium ad- 
justments acceptable to the Commis- 
sioner, the Commissioner may order 
premium adjustments, refunds, or pre- 
mium credits deemed ncccssar\' to achieve 
the loss ratio required bv this Rule. 
(2) (-(?+ Any appropnatc riders, endorsements 
or policy forms needed to accomplish the 
Medicare Supplement insuruncQ supple- 
ment policy or certificate modifications 
necessary to eliminate benefit duplications 
with Medicare. Aay ' ; . uch Such riders. 
endorsements or policy forms shall pro- 
vide a clear description of the .Medicare 
Supplement supplement benefits provided 
by the policy or contract, certificate. 

.0824 RKQl IKFD DISCLOSLKK I'ROMSIONS 

(a) General Rules. 

(1) Medicare Supplement Policies , supplement policies and certificates shall include a renewal or 
continuation pro\ ision. The language or specifications of such provisions must be consistent 
with the type of contract issued. Such provision shall be appropriately captioned and shall ap- 
pear on the first page of the pohcy, and shall include any reservation bv the issuer of the right 
to change premiums and any automatic renewal premium increases based on the policyholder's 
age. 

(2) E.xccpt for riders or endorsements by which the im . urer issuer effectuates a request made in 
writing by the insured, exercises a specifically rcscr\'ed right under a Medicare Supplomont Pe4- 
i<?¥7 supplement policy, or is required to reduce or eliminate benefits to avoid duplication of 
Medicare benefits, all riders or endorsements added to a Medicare Supplement Policy supple- 
ment policy after date of issue or at reinstatement or renewal which reduce or eliminate benefits 
or coN'crage in the policy shall require a signed acceptance by the insured. After the date of 
policy or certiticate issue, any rider or endorsement which increases benefits or coverage with a 
concomitant increase in premium during the policy term muat shall be agreed to in writing 
signed by the insured, unless the benefits are required by the minimum standards for Medicare 
Supplement Imairance Policie ' j. supplement policies, or if the increased benefit l . &f coverage is 
required by law. Where a separate additional premium is charged for benefits pro\idcd in con- 
nection with riders or endorsements, such premium charge shall be set forth in the policy. 

(3) A Medicare Supplement Policy which provides supplement policies or certificates shall not pro- 

vide for the pa\ment of benefits based on standards described as "usual and customary," "rea- 
sonable and customary" or words of similar import, ^tali ijiclud e a definition e^ cuch temin aft4 
aft explanation »f such term '. i» it* accompanying outline ef ccerage. 



(d) Public I learings. The Commissioner may 
conduct a public hearing to gather mlonnation 
concerning a request by an issuer for an increase 
in a rate for a policy form or certificate form, if 
the expenence of the form for the previous re- 
porting period ^ not in compliance with the ap- 
plicable loss ratio standard. The determination 
of compliance is made without consideration of 
any refund or credit for such reporting period. 
I'ublic notice of such hearing shall be furnished 
in the manner prescnbcd bv statute. 

Stalutoty Auihority G.S. 58-2-40; 58-54-20. 

.0823 FILING REQl IRF..MEN TS FOR OLT- 
OF-SI AFE GROl P fOFIClES 

Esery int . ur e r providing group Medicare Sup 
pl e m e nt inf i uruncu benefit i . te a rooident »f tfei* 
i . tut e purr i uant to iVrticlo -§4 »f Chapter -i^i ef the 
North (Carolina General Stututer . i . hall fii» a copy 
»f tb» ma -. t e r policy aft4 any certificate UL i cd ift 
th+>i '. tal e m accordance ' . ' ■ ith At* filing require 
mentr . aft4 procedure; ! applicable to group Medi 
«*«» Supplement Policiea i > i! i ut ' d h* (44* > itat e ; 
provided, ho' i seser. that- w^ influrer r . hall l*e Fe- 
quired te- make a filing earli e r than ^ da> s after 
in '. urunc e wa* prov id e d te- * r e- id e nt ef tht* >i late 
under a ma - jter policy i - iiu e d fef dolivory out ' id e 
t+H* ■i tat e . 

Statulon' Authoritv G.S. 58-2-40; 58-54-20. 



6:16 NORTH CAROLINA REGISTER November L\ 1991 



1122 



PROPOSED RULES 



(4) If a Medicare Suppk'mL'nt Policy supplement policy or certificate contains any limitations with 
respect to preexisting conditions, such limitations muot shall appear as a separate paragraph of 
the policy and be labeled as ''Preexisting Condition Limitations". 

(5) Medicare Supplomunt Policioii ef supplement policies and certificates shall have a notice prom- 
inently printed on the first page of the policy or certificate or attached thereto stating in sub- 
stance that the pohcyholder or certificateholder shall have the right to return the policy or 
certificate within 30 days of its delivery and to have the premium refunded if, after examination 
of the policy or certificate, the insured person is not satisfied for any reason. 

(6) In ^' UrL ' r i. i - jnuintj Issuers of accident and health policies or certificates ef subocribor contracts which 

provide hospital or medical expense co\'erage on an expense incurred or indemnit\' basis, other 
than incidentally, to persons eligible for Medicare by reason of age shall provide to ali such ap- 
phcants a copy of tl*e North Carolina Buyers Guida aft4 the Medicare Supplement Buyer's 
Guide in the form developed jointly b\ the National Association of Insurance Commissioners 
and the Health Care f-'inancing Administration in a t\pe sbe no smaller than 12-point tvpe. 
Delivery of the Buyers Guide shall be made whether or not such pohcies or certilicates ef s«^ 
ooribor oontract ' j are advertised, solicited or issued as Medicare Supplement PoHcieo supplement 
policies or certificates as defmed in this Rule. Except in the case of direct response mouroro, 
issuers. deh\ery of the Buyer's Guide shall be made to the applicant at the time of application 
and acknowledgement of receipt of the Bu> ers Guide shall be obtained by the inijurjr. issuer. 
Direct response ini . urijrf ' issuers shall dehver the Buyer's Guide to the applicant upon request 
but not later than at the time the poHcy is deli\ered. 

(b) Notice Requirements. 

(1) As soon as practicable, but no later than 30 days prior to the annual effective date of any Med- 
icare benefit changes, gs ep . in 'i urijr. health ew^ r . op i icij {4aft ef other entity providing MeJicaro 
SupplL'ment inf i urancL' ef bonefitii te a resident ef At* ■■ tute an issuer shall notify its policyholders 
contract HoUlT ' ; . and certificate holders of modifications it has made to Medicare Supplement 
hiL i urance Pulicic;: . ef contracts supplement policies or certificates in a format acceptable to the 
Commissioner, ef m Ae format proccnbed m- litle 44 NCAC 4-3 .0833 (Form -Vf if He othor 
formal it; pre '. cnbed tȴ t+w* Commi ' jr . ioner a* folio sv: . : Such notice shall: 

(A) Include a descnption of re\isions to the Medicare program and a descnption of each modifi- 
cation made to the coverage provided under the Medicare Suppk ' m e nt In i. urance PoUcy ©f 
contract, supplement policv or certificate, and 

(B) Inform each co' . ered pijrson policsholder or certificateholder as to when any premium ad- 
justment is to be made due to changes m .Medicare. 

(2) 1 he notice of benefit modifications and any premium adjustments shall be in outline form and 
in clear and simple terms so as to facilitate comprehension. 

(3) Such notices shall not contain or be accompanied by any sohcitation. 

(c) OutUne of coverage requirements for .Medicare Supplement Policier . . supplement policies. 

( 1 ) InL i urerii issuing .Medicare Supplement Policies ef certificates fof deh' . er ! h» tiw* state Issuers shall 

provide an outline of coverage to aJ4- applicants each applicant at the time apphcation is mad e 
presented to the prospecti\e applicant and. except for direct response policies, shall obtain an 
acknowledgement of receipt of such outline from the apphcant; and 

(2) If an outline of coverage is pro\'ided at the time of apphcation and the .Medicare Supplement 



Pohcy supplement policv or certificate is issued on a basis which would require revision of the 
outline, a substitute outline of coverage properly describing the policy or certificate must shaU 
accompany such policy or certificate when it is delivered and contain the following statement, 
ia no less than 12 point type, immediately abo\e the company name: 

"NOTICE: Read this outline of coverage carefully. It is not identical to the outline of co\erage 
provided upon apphcation and the coverage originally applied for has not been issued." 
(3) The outlme of coverage provided to apphcants pursuant to this Rule consists of four parts: a 
cover page, premium information, disclosure pages, and charts displaying the features o| each 
benefit plan ottered bv the issuer. Ihe outline of coverase shall be in the lantiuase and format 



prescribed in Subparaa"aph (c)(4) of this Rule m no less than 12-point t\'pe. All plans A -J shall 



be shown on the co\er pa'.:e. and the plan or plans o lie red bv the issuer shall be prominently 



identified Premium information for the plan or plans offered shall be show n on the co\ cr page 



or immediately followini; the co\er pasie and shall be prominently displa\ ed. The premium and 



mode ^hall be stated for each plan that is offered to the prospectn'e applicant. AH possible 
premiums for the prospective applicant shall be illustrated. 



Il2i 6:16 NORTH CAROLINA REGISTER November 15, 1 99 1 



PROPOSED RULES 



(4) Ihe outline of coverage shall be in the language and format as prescribed by the NAIC in Section 
16C(4) of tine Model Regulation to Implement the N/MC Medicare Supplement Insurance 
Minimum Standcirds Model Act, as adopted July 3U, 1^91, including any subsequent amend- 
ments and editions. A copy of this format is on tile with the North (,'arolina Department of 
Insurance. Copies may be obtained at a cost of fourteen dollars (S14.()()) each from the I ife and 
Health l3i\ision. 4.^0 N. Salisbur\' Street, Raleigh, North Carolina 2761 1. I'aragruplui H-) *H*i 
(4f L i hall b# » t4*e form prfjcnbcd below: 

[COMPANY \ A\1F| 
OUT LINE Of- .MI ' DIC.VRI ' SL PPL [MI ' N I CO\ l K\GE AJvt» I'RLMICM I'' . ! ORM.VT I ON 

y*e Ai* outhn e te- compar e benofits aft4 premiumf. among policioo. 

fA^ Raad your policy carefully - Thio outline' »f oo' i 'L'raffl providoo a vef¥ brief doooription ei t+»» 
importcmt f e atur e s ef your policy. Thio » set- the innuranco contract aft4 only tfee actual policy 
pro^ifiionf i w+W control. 44h» policy itr . olf fiete forth ift d e ttul the rightr . a«4 obligations et" both 
¥e» a«4 vour inr . uranco company. J4- h^ thoreforo, important tfeat- ye« KliAD ^^OL k P(> I I C Y 
"CARRI'Li LM 

fft^ Mc'dicare Suppk'mi'nt Covorago - PoliciL'n af t4w catogoiy afe d e r . ignijd to suppk ' tTiL'nt Medi 
eafe by- co' . onng iioiuo ho '. pitul. medical afhi fiurgioal ' j e P r ice '. vvhich afe partially cos'erod by 
Medicar e . Coverage k provided fof ho ' ipitol inpatient charges aft4 f . ome physician charges, 
subject to- ftfw deductibles f+ft4 copayment provisions which may be in addition te those pfo- 
vided by Medicare. »ft4 subject te oth e r limitations which f»«y be '■e* forth ift Ae policy. '+4te 
policy does fte4- pros ide benefits fof custodial eafe such »». help » ' ■ ' ■ alking. g e tting i«- aft4 ewt- 
*4 bed. eating, dres .'. ing. bathing i*ft4 taking medicine [delete if such coi i erag e i« pro' i idedj. 

kQ^ (M [fef agents: ! 

Neither [insert company's nam e[ HOf i^ ag e nts afe connected with .Medicare. 

(+i-^ (4of direct re '. ponses: | 
[insert company s name| i^ ftot- connected ' i S ith Medicare. 

f©-^ (tV brief summary e4 the major medical benotit gaps h+ Medicar e Parts A fc ft with a parallel 
d e scnption 8+ supplemental benefits, including dollar amounts (and indexed copayments »f 
dL'ductihles. *7 appropnatj). provided by (4te Medicare iSupplement coi i erag e ift t4%e foUo' i ' i ing 
order:) 



DLSCRIPI I ON 
tr \L i r ii mu i ii Slaiidarda 
SI RMCI ' 
I'ARL A- 
IM'MI I \l HOSPII 



^R44J^ POLICE PV^S^T 



¥Ot.PrVe 



A4- SI R\ 1( LS i 



Semi I'n'iiite Room <Vt Hoard 

Miscellaneous I Uv . pilal Services 

fe Supplies, such a* Drugs. 

X Ra'iS. l-*b T e sts A: Operating Room 

blood " 

P \R1 » 

MIMICAL LXPLN S L ; 

Senices (r4 a Physician,' 

Outpatient Services 

Medical Supplies aft4 other than 

I'rescnbed Diiigs 
B LOOD 
MlSCLl I AM ' OCS 

Immuno 'i uiipressi' i e Dnigo 



OF.SCRinilO\ 
Wr . ■ Vdd i L i oiml Bo no fit!) 
PART A- 

fert A Deductible 
Private Rooms 
In llo '. pitid Private Nurses 
Skilled Nurs i ing luicilitv Care 



T++4^ POfc4€^ 4-LW* 



V44t-PAV 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



1124 



PROPOSED RULES 



PARI A-feft 

llomc llualth Scnicoo 
I'AKI ft 

;^«rt Vr D e duotiblo 

Modicarij jMlowahlo Pxponi i LT i 

( I'orci ' nluUL ' Paid) 
OL I or l'0( kl ' l MAXIMUM 
I 'RISCR I I' I l ()\ DKlCiS 
M I ,S( 11 I WI'OLS 

Ro 'i pilO CuR ' Ik ' IK'flt ' j 

lixponiio Incunrjd » 
Foreign CountiA 

m i iiR ! 



l OI Al PR! M I LM 



1^ ADDIIIOV +« ;H+4>^ OL TI INIi ^4^ CONI RAGE, |1\SLRANCF COMPA\^ NWir) W ll I S I M) 
JrV AWL \ l \OriCh «^ VOt- ^ »-Vv4; PR I OR ++4 ++++- [ M l Cri\ F D \ I I ' (^t- \l l' O I ( \R i : 
C II A\(;i:s WH I CH w i ll DLSCRIBL TI I LSE CHANGLS rVM^ ^H+fe CII.A> , GL^ t^ ^OLR MLDI 
C:\RL SL Pl^ i I ' MLNT CO\ LRAGE. 

•i^tf th+s policy doL ' i . h«+ prcido oo' . c'ragQ fof a b e noFit liiitod » t4«s Mulu, tfee iri 'i ur e r mu '. t ■rtek' 
i^fto cos' i jragj" booido tfea* bonofit » t+n* fi«t- column. 

(^ Fomi A ' jhall accompany the outline trf co' . eragj. 

fft- StatL ' mijnt A«4- t4w policy do e- j tw dojn m^ covlt tbt^ foUowing: 

(+} PiT i ati. ' duty nur ' iiiig: 

(+H Skilk ' tl nuf ' ing Ihmiio ertw CQ; . t ' ; i (boyoiid ' . ' ■ 'hat k covcrod by AK'dicaiv): 

f+H-^ Cu ;. todial iiur '' ing homo ertw colUo; 

(+¥-)• Intcnnt'diut e nur '. ing homo eafe cof i tn: 

(v^ I Kimo HlmIiH (?*Ft» abo^L ' numbc ' r »f si '. itfl cos t rod by Mt ' dicar e : 

fw->- Phy 'i ician chargL" . (abovo Mt'dicaror . rcar i oniiblc chaigc; . ); 

fvH-f Dmg ' j (other than proccriptiou druga furni^ ' hod during » hospital b* ;. kill e d nur ' j ' ing facility 

(viii) Caro rocois'od outi i ido tfe» L'.S.j\.; 

f+^ Dental eew ef denture '. , checkupo. routin e immuni/'ationr . , oodmotic surge Py', routine feM*t- 
care, exiiminalion - j fof t4+e tr»*4- fc4 eyegla ' j ' jef i t+f hearing aids. 
fG^ A dei . cnption »f aHV policy prosir . ion ' j ' . h hich e.xclude. eliminate, rei . if . t, reduce, limit, delay, 
w^ m iWHr other manner op e rate to qualify payment l i e4 t4+e bene fit Li de ' , . cribed i«- I'aragraph (c)(.V) 
t-4 t44s Rule, includmg coiT . picuou - : . i i talementft; 

(+> That t4*e chart L i ummari/ing Medicare benefits onl; i briefly de ' . ' CnbeM ' .aicli benefits. 
fH-)- Lhat the Health L'are i'iiiancing i\dministratioii wf- i+s .Medicare publicalionri t i hould be 
consulted fof further d e tails »h4 limitations. 
f4-l4 A ilescnption ef policy pro' i isi(M"is respecting ren e wability e* continuation fvf co' i 'orage. ift- 

cluding m¥t res . enation e4~ nglits tt+ chang e premium. 
(4^ 44+e amount t4 premium f++f th+s i')olicy. 
(d) Notice regarding policies or svibscriber contracts certificates which are not Medicare medicar e 
supplement pohcies. yVny accident and health insurance policy or subscriber contract, certificate, other 
than a modicaro Medicare supplement policy; or a pohcy issued pursuant to a contract under section 
1S76 of the Federal Social Security Act (42 U.S.C. 13*^5 et.seq.), disabihty income policy; basic, cat- 
astrophic, or major medical expense policy; single premium nonrenewable policy or other polic\' iden- 
tified Title in 11 NCAC 12 .0816(2), issued for deliver) in this state to persons eligible for .Medicare 
b\ reason of age shall notify insureds under the pohc\ t+f subscriber contract that the policy »f w*h- 
scriber contract is not a Medicare Supplement Policy, supplement polic\ or certilicatc. Such notice 
shall cither be pnntcd or attached to the first page of the outline of co\erage dehvered to insureds under 
the policy, ef subscriber contract, or if no outline of coverage is dcli\'crcd. to the first page of the policy 



U25 6:16 NORTH CAROLINA REGISTER November 15, 1991 



PROPOSED RULES 



or certificate ef Gubi ' Cribor contract delivered to insureds. Such notice shall be in no less than 12 point 
type and shall contain the following language: 

"THIS [POLICY OR CIRTIITCATt ^^" sUBSCRIBr.R CONTRACT ] IS NOT A MEDICARE SLPPI.E- 
MENT |POI IC\' OR CONTRACT CERTIFICATE! . If you are eligible for Medicare, review the Medi- 
care Supplement Buyers Guide available from the company." 

Statiiloij Authority G.S. 5S-2-40; 58-54-25. 

.0825 KKQLIREMEMS FOR APPLICATION FORMS AND REPLACEMENT COVERAGE 

(a) Application forms shall include the following questions designed to cUcit information as to 
whether, as of the date of the application, the applicant has another Medicare Supplomont supplement 
or other health insurance policy or certificate in force or whether a Medicare Supplomont Policy sup- 
plement policN' or certificate is intended to replace any other accident and health policy or certificate 
presently in force. A supplementary apphcation or other form to be signed by the applicant and agent 
oKCopt whore tiw cosorage '» m44 without a» agont, containing such questions and statements may be 
used. 

[Statements] 

( 1) \"ou do not need more than one Medicare supplement policy. 

(2) If vou are 65 or older, vou may he eligible for benefits under Medicaid and ma^^ not need a 
Medicare supplement policv. 

(3) Ihe benefits and premiums under vour Medicare supplement policv will be suspended during 
your entitlement to benefits under .Medicaid for 24 mcmths. '^ ou must request this suspension 
within 90 da\ s of becoming eligible for .Medicaid. If \ou are no lonuer entitled to Medicaid, 



vour pohcv will be reinstituted if requested within 90 davs of losing Medicaid eligibility. 
(4) Counseling sen,ices may be available in vour state to pro\ide advice concerning vour purchase 
of -Medicare supplement insurance and concerning Medicaid. 

[Questions] 

To the best of \our knowledge. 

(1) Do you have another Medicare Suppl e ment in - ' . urancj supplement policy or certificate in force 
(including health care scmce contract, health maintenance organization contract)'? If sex with 
which companv'!* 

(2) ©t4 ¥»«■ ha' i L ' another Medicare Suppl e ment policy e* certificate m force during t4*e kw+ 44 

month '. ? Do \ou have any other health insurance policies that provide benefits which this 
Medicare supplement policy would duplicate'.' 

(A) If so, with which company'.' 

(B) tf that- policy laps e d, sshen 4*4 tt lapf .e ? WTiat kind of policy'^ 

(3) f4^ If the answer to question 1 or 2 is ves, do i^e you intend to replace awy »f your these medical 

or health insurance coverage policies with this pohcy [certificate]'? 

(4) (4| Are you covered by Medicaid? 

(b) Agents shall hst any other health insurance policies they have sold to the applicant. 

(1) List policies sold which are still in force. 

(2) List policies sold in the past five years which are no longer in force. 

(c) In the case of a direct response issuer, a copy of the application or supplemental form, signed bv 
the applicant and acknowledged bv the issuer, shall be returned to the applicant bv the issuer upon 
delivery of the polic\-. 

^d) fef Upon detemrining that a sale will involve replacement aft insurer, of .Medicare supplement 
coverage, any issuer, other than a direct response inr . urer issuer or its agent, shall furnish the apphcant, 
prior to issuance or deli\cr\' of the .Medicare Supplement Policy supplement policy or certificate, a 
notice regarding replacement of accident a«4 health Medicare supplement coverage. One copy of such 
notice signed by the applicant and the agent, except where the co\'erage is sold without an agent, shall 
be provided to the applicant and an additional signed copy shall be retained by the innuror. issuer. A 
direct response inourer issuer shall deliver to the applicant at the tune of the issuance of the policy the 
notice regarding replacement of accident afi4 .r i iclmoss Medicare supplement coverage. 



6:16 NORTH CAROLINA REGISTER ^ovembcy 15, 1991 1 126 



PROPOSED RULES 



(e) (4^ I'hc notice required by Paragraph fe) (d) of this Rule for an Lnr . uror. othor than a direct r g sponao 
inouror, issuer shall be provided in substantially the following form in no less than IQ-point type: 

NOTICE TO APPLICANT REGARDING REPLACEMENT 
OF MEDICARE SLPPLE.MENT INSLR.ANCE 

(Insurance company's name and address) 

SAVE THIS NOTICI:! IT MAY BH IMPORTANT TO YOU IN THE EUTURE 

According to [your application] [information you have furnished], you intend to lapso ef othonvic i o 
terminate existing Medicare Suppknnont supplement insurance and replace it with a policy to be issued 
b\ [company n:mie| Insurance Company, "^'our new policy providijc will pro\ide 30 days within which 
you ma_\ decide without cost whether you desire to keep the policy. ¥-^^ your own inf('miation afi4 
protection. y*M* ^. hould l*t» awar e ef rtftd- '' L'nou ' . i ly oonoidor certain factors which may alToct tfee ini i uranco 
protection axiiluble te- y*»«- *h4 und e r tht> ftew policy. 

\'ou should review this new coverage carefuUy. comparing Compare it with all accident and sickness 
coverage you now have. aH4 lenninate T'erminate your present pohcy only if after due consideration, 
you find that purchase of this Medicare Supplement supplement coverage is a wise decision. 

STATEMENT TO APPLICANT BY ISSL ER OR AGENT [BROKER OR OTHER 
REPRES1:NT"ATIVE[: 

(L se additional L . heet ' ; . . a^ nocouoap . .) 

I have reviewed your current medical or health insurance coverage. \ believe the The replacement of 
insurance invoked in this transaction materially improsei . your position, My conclu - jiun ka* taken tHte 
account the following considerations. V i hich I- eaii to- >our attention: does not duphcate coverage, to 
the best of mv knowledge. The replacement policy i^ being purchased for the following reason(s) 
(check one): 

.Additional benefits. 

No. change in benefits, but lower premiums. 

fewer benefits and lower premiuniN. 

Other. ( Please specify ) 

(1) Health conditions which you may presently now have (preexisting conditions) may not be im- 
mediately or fully covered under the new policy if vou have had \our present policy for less than 



six months. 1 liir . could result m denial f+f d e lay t+f » claim k+f b e nefits under Ae BrWr policy, 
v' l hereas » similar claim iniglit have been payable under your present policy. 
f4f State k*vr prov ides t4*rrt- your reinstitiited b+ replacement polic> t>f certificate may fi«4- contain 



new preexisting conditions, waiting penods, elimination peiiods &* probationary periods. 4^ 
insurer ¥r4tt vsai' . e ttm- time periods applicable te pree.xisting conditions, waiting periods, olimi 



nation penods, t+f probationar t periods Ht t-he new policy (-»f cov erage) fof similar benefits t» 
(4*«* extent such lime ¥rtt^ spent (depleted) under t4*e original policy. 
(4-^ U ve«- iifi* replacing e .xistuig .Medicare Supplement insurance coverage, y*Hi (way- wish te secur e 



A# advic e ei your present insur e r e+ it* agent regarding the proposed replacement &i your pros 
efht policy. This i* Ht+t only your riglit. Inrt- it i* akso- i« vour be^ interest te- make &t«* yes 
understand att the relev cint factor '! involved m replacing your present cov erage. 
(2) (-H If ufier tk*e consideration. \"ou stiU wish to terminate your present pohcy ;md replace it with 
new coverage, he cert.iin to tmthfuUy and completely answer aU questions on the application 
concerning your medical and health history. Failure to include aU material medical information 
on an application may provide a basis for the company to deny any future claims and to refund 
vour preniium as though your policy had never been in force. /Vfter the application has been 
completed and before you sign it, reread review it earefuUy to be certain that all infonnation has 
been properlv recorded, [jf the poUcv or certificate is guaranteed issue, this Paragr:iph need not 
appear.] 

Do not cancel vour present policy until vou have received your new policy and are sure that you want 
to keep it. 



1127 6:16 NORTH CAROLINA RECISTER November 15, 1991 



PROPOSED RULES 



Signature of Agent, Broker or Other Representative 
[Typed Name and Address of Issuer, Agent or Broker] 
5^ abo' i c "Notic e te Applicant" wa* dolhoru ' d to Fft» efH 



(BAIL) 



(Applicant's Signature) ( Date) 

^Signature not required for direct response sales. 

(f^ Paraigaph ]_ of the replacement notice (applicable to pre-existing conditions) may be deleted bv 
an issuer if the replacement does not insolve application of a new pre-existrng condition limitation. 
fe^ 4-fet» notice required h\- I'uragruph (-*>) ef t4*i^ Rule ' fof a dir e ct rO ' jpon ' jO bhuU bi* a* foUowc: 

NOTICE TO API'IICWr kliG ARDING RTPI \CF.ML\T 
(^ Ml DICARr SLPI'I rM^Nr IWSL RAVCE 

(Ini ' Urancu company'ii name aft4 addrcLfi) 

gA-yi&TWtJ^ NOTICn' ff ^tA^ ftp. IMPORT.VNT T^ ¥04; ^jv T^fe FLTlRn. 

According to [your appliciition| [uiformation yew has'o fumif ^ hcdl y©«- intond to lapco ©f othor . ' . ioo tof- 
minat B uxi ' - . tinii MLidicaro Supplt'inL ' nt ui ' . . uranc>» aft4 rfplacu it- with At* pohcy JolisLTi'd horc i ' i ith i ' jvuod 
by [company numul In ' jUraiice Company, ^"our Ht*Vr policy providc - j ^ day. , w ithin ' . s hich ytn* may 
docidt. ' without e©^ s s heth e r ¥€Hi dooiro to keop the pohcy. P»f your osvn info nnat ion afi4 protection, 
y&H f . hould be QwarL ' ef aft4 i i LTiouoly con ' jidor cortain factorr . sshioh fway afft ' ol t4** iii ' juranc e protection 
a' l ailabk' to yt+« undor (4w fh*vr policy. 

¥€Hi Dhould ri" i ii- ' w tfe* ftr^w- co' i L'ragL ' carefully, compiiring it- ' i vith aH- accident aftd oiclaie ' , .' . . coverage 
y€Hi no' i v ha' i e. aj+d lenninate your present pohcy only ifr alter 4«e coo '. ideration, yet* fifi4 t4+a4- purchui ' O 
»f tfe* Medicare Supplement co' . erage Ht a ss i^e deci '. ion. 

(4-^ Health condition - ; , vv ' hich ye-i* may prei i ently bave (pree.'UL . ting condition - - . ) may ftet- be imme 
d lately »f fully cosered under tbe fh*w- pohcy. 1 lii - j could re - : . ult i«- denial Bf delay ef a claim ft>f 
benefits . undiT tbt» i+ew policv . whereai . a - . . iinilar claim miglit have been payable under your 
pre ! , ' ent policy. 
f^ Slate krtv provide!, , y+at- your rein -. tituted h+ replacement pohcy ef certilicatL ' may Ht4- contain 
ftevr pree)U ' : . ting condition - : . , wciiting penod - j. elimination period - ; . »f probationary period - j. ^ our 
insurer witt ' ■ vaivo af*¥ time p e riod - , , apphcable to pree.'UL . ting condition - : . , waiting periods, ohnii 
nation periods, ef probiitionarv ' period - , . » tbe Rew policy fe* coverage) fo* - similar benefit - : , to 
the extent - . . uch time w^*^ f . pent (d e pl e ted) under tbe original policy. 
(^ tf ¥**«- afe r e placing e.vi -. ting Medicare Supplement ui ' . ' Urance coverage. ye» may ' I ' . i - jh to - recure 
tbe ad' i ic e »f >our pre - ^ent mi i urer tvf ite agent regtuding t4*«» propor . od replacement ef your pre - . , 
ewt- policy, this i^ Ht+t- only your right. b«t- it- ts ai?^ i» your be^ inlere - jt to make L: . uro yen* 
under - jtand all- tbe rek" i -ant factor - . . iiT i oKed » r e placing your pre - jent coverage. 
(4) [T«- be included only if tbe apphcation h» attached to tbe policy .[ tfy after dwe consideration, yett 
^+iii wi ' jh to t e nninate your pre - : . ent pohcy itf^ replace it- with ftew oo>erage. read tbe copy ef tbe 
application attached to your sew- pohcy afhi be sttfe tbat- att que - jtionL . afe anL . v i xned fully aftd 
CO iTJCtly. Omi i. r . ion - : . (¥/■ mi - . i- : . latement; . m tbe application could cau -. e an- othen . ' i i - - . e salid claim 
to be denied. Carefully check tbe apphcation »f^ vaite to [Compan;. Nmne aad Addre ' . . - . | within 



^ i^i^ if aftv 
left etrt-ef tbe 


inlo nnat ion i* Hot- correct 
application. 


aft4 complete. 


»f- '4 


asy pa^t- 


medical bt 


--■tor. 


ba* been 




^ 


ompany 


Name) 






6:16 


NORTH CAROLINA REGISTER 


November I 


.5, 1991 




112H 



PROPOSED RULES 



Statuton Authority G.S. 5S-2-40; 58-54-25. 

.0826 III l\(, RFQl IKKMKMS FOR 
ADNKRTISING 

E' l On^ in '. urer. hor . pitul »f mudiocJ o e n'ic e eef- 
p(Kati(in t^ houlth maintL ' iuiiio e urgunii'ation e* 
(ithor L'ntity pimiLlinLi MoJicart ' Supplement tft- 
r . urance *«= bcnoritr . t» tt«^ r . tatL' An issuer shall 
pro\'idc a copy of an\ Medicare Supplomont 
supplement advertisement intended for use in this 
state \s hether through written, radio or tele\ision 
medium to the Commissioner of Insurance of 
this State Ot4 day . pnor to its use for review or 
appro\al by the Commissioner as required under 
state law. 

Statutoiy Authority G.S. 58-2-40: 58-54-35. 

.0827 S lANnARDS FOR MARKETING 

(a) fivei^' iri ' jurL ' r, health eaj* r i orsioo plan »f 
other entity marketing Medicare Supplement >«- 
F . uranc e co' i erag c m- t+H^ ^. lat e . An issuer, directly 
or througli its producers, shall: 

(1) listablish marketmg procedures to assure 
that any comparison of policies by its 
agents or other producers uill be fair and 
accurate. 

(2) [:stabhsh marketing procedures to assure 
excessive insurance is not sold or issued. 

(3) Display prominently by type, stamp or 
other appropnate means, on the first page 
of the outline el cov e rag e afl4 pohcy the 
following: 

"Notice to buyer: This policy may not 
co\er all t-4" At» coi . tr . a i. r . OL'iated ' ■ ' ■ ith 
medical «*w incurred t»y (4+e buyer dunng 
t+H* period t*f coverage, i^ buy e r t* »d- 
' ■ i 'l ed U^ review carefully *W policy lunita 
tion i f i \our medical expenses. " 

(4) Inquire and otherwise make every reason- 
able effort to identify whether a prospec- 
tive applicant or enroUee for Medicare 
Supplement supplement insurance already 
has accident and sickness insurance and 
the types and amounts of any such insur- 
ance. 

(5) EseP i mourer ef entity marketing .Medicare 

Supplement in '. urunce - jhall e '. tablii i h Is- 
tablish auJitable procedures for venfying 
comphance with Paragraph (a) of this 
Rule. 

(b) In addition to the practices prohibited in 
Article 63 of Chapter 5S of the North Carolina 
General Statutes, the following acts and practices 
are prohibited: 

(1) Twisting. Knowingly making any mis- 
leading representation or incomplete or 
fr;iudulent companson of any insurance 



policies or inouror i } issuers for the purpose 
of inducing, or tending to induce, any 
person to lapse, forfeit, surrender, termi- 
nate, retain, pledge, assign, borrow on, or 
convert any insurance policy or to take 
out a pohcy of insurance with another 
lU ' . i Urer. issuer. 

(2) High pressure tactics. Employing any 
method of marketing having the effect of 
or tending to induce the purchase of in- 
surance through force, fright, threat 
whether explicit or imphed, or undue 
pressure to purchase or recommend the 
purchase of insurance. 

(3) Cold lead advertising. .Making use directly 
or indirectly of any method of marketing 
which fails to disclose in a conspicuous 
maimer that a purpose of the method of 
marketing is sohcitation of insurance and 
that contact will be made by an insurance 
agent or insurance company. 

(c) T he terms "Medicare Supplement," 
".Medigap." ".Medicare \Vrap-.\round," and 
words of similar import shall not be used unless 
the policy is issued in compliance with this Rule. 



Statutory Authority G.S. 58-2-40. 

.0828 AIM'ROrRIVTFNF.SS OF 

RKCOMMFNDED PLRCH.VSE AND 
F\CESSI\ F INSl RANCE 

(a) In recommending the purchase or replace- 
ment of any .Medicare Supplement supplement 
pohcy or certificate an agent shall make reason- 
able efforts to determine the appropriateness of 
a recommended purchase or replacement. 

(b) .Any sale of .Medicare Supplement supple- 



ment co\'erage ^s hich that will pro\ide an indi- 
\idual more than one .Medicare Supplement 



supplement pohcy or certificate is prohibited 
provid e d, hov . e' l X ' r, t-brrf- additional .Medicare 



Supplement co' i erage may be> se44 tfr when com 
bined ' ■ ' ■ ith t+Hri- indi' ^ idual' - j health coi i enige al- 
read' i m force, ri- would inr . ure »» more than 44W 



percent t4 A» indisiducd' ' .! actual medical »s- 
pen^es covered under tl** combined policie - i. 

Statutory .Authority G.S. 58-2-40. 

.0829 REPORTING OF MLLTIIM.E POLICIES 

(a) On or before March 1 ewn im . urer t*f other 
entity pro' i iduig Medicare Supplement imairanc e 
co' i erage m t4w* f . tato of each >ear an issuer shall 
report the following information for e\'er\' indi 
viduid resident of this state for which the inLiirgr 
fvf entity issuer has in force more than one .Med 



II29 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



PROPOSED RULES 



icare Supploinunt supplement insurance policy 
or certificate: 

(1) Policy and certificate numbers, and 

(2) Date of issuance. 

(b) The items set forth in this Rule must be 
grouped by individual policyholder. 

fc) The reporting form for compliance with this 
Rule shall be in the format prescribed by the 
XAIC in Appendix B of the Model Regulation 
to Implement the NAIC .Medicare Supplement 
Minimum Standards .Model /Vet, as adopted July 
3(1. 1991, including anv subsequent amendments 
and editions. A copy of this form is on tile at the 
North Carolina Department of Insurance; and 
copies mas be obtained from the Department a[ 
a cost of fifty cents (SO. 50) each. 

Statutoiy Auilioriiy G.S. 5S-2-40. 

.0830 proiiibhions in rrplacement 
poi.rcies or ceriii ic.vtes 

(a) If a .Medicare Supplement supplement policy 
or certificate replaces another Medicare Supple 
tnent supplement policy or certificate, the re- 
placing iiiiiurer issuer shall waive any time 
periods applicable to preexisting conditions, 
waiting penods, elimination periods and 
probationary periods in the new Medicare Sup 
plemont supplement poficy fof •. imilar benefits to 
the extent such time was spent under the original 
policy. 

(b) If a Medicare supplement policy or certif- 
icate replaces another .Medicare supplement pol- 
icy or certificate that has been in effect for at least 
six months, the replacing policy shall not pro\'ide 
any time period applicable to pre-existing condi- 
tions, waitm-j periods, elimination penods. or 
probationary' penods. 

(c) A separate charge may not be made to the 
applicant for the waiver of the pre-existing con- 
dition or other waiting peri(.^d in a replacement 
poficy. 

Stalutoiy Auihority G.S. 5S-2-40. 

.0831 MEDIC.VRE SLPPIEMENT .VNNLAL 
REPORI 

Lach insurer shall report eft t+f before .luly \^ 
©f e ach yt»f k» the Commissioner the following: 
f44 policy »f c e ilificute pfeft name: 
fi) poficy wf certificate form numb e r; 
{^ policy (^ certificate approval date; 
f4f number ef insureds; 
f4) plans withdrawn from sal e ; aR4 
(4) in 'i urur's address aft4 telephone number. 

Stalutoiy Authority G.S. 5S-2-40. 



.0832 NOTICE FORMS 

44^ notice required l»y 44 N'CAC \i .082 ' l(b)( 1) 
ohall appear i» A<? following format: 

f-}4 Form A i* a notice* tk*t- describes awy- 
changes m Medicare coverages fof th*» ^vtf- 
Feftt aft4 following y e ars aw4 aftv resulting 
changes m Medicare Supplement co' i 'erage. 
This notic e must include tb» name ef A© 
company issuing the policy a^ vreW a^ the 
agent ' . vho seik the .Medicar e Supplement 
poUcy. 

<r^ Ail- forms described vpt At* Rule i»«¥ he 
obtain e d Wt the I ifo, i\ccidenl aft4 Iljallh 
Disision, North Carolina Department t+f 
Insurance. 4tW >i-T Safisbur . Street, Raleigh, 
North Carofina 37611, w ' hy calling m^ 
733 5060. 

Statutory Authority G.S. 5S-2-40; 5S-54-I0; 
58-54-15; 5S-54-25; 58-54-35. 

.0833 BENEUT CONNERSION 

REQl IREMEN IS 1)1 RING TRANSITION 

(rtj ntTecti' i e Januari +t U J ^ i O, ft» Medicare 
Supplement iii '. urance policy, contract t+f curt if 
icat e tft force ift tht^ stat e shall contain benefits 
which duplicate benefits provided by- .Medicare. 
f4*) Benefit i i eliminated hy operation »t the 
Medicare Catastrophic Coverage A*t t*f 1 ' ) S;j ^ 
transition pros isions shall he restored. 

(-ef l-4*f .Medicare Supplement policies subject 
t» minimum standards adopted by tfee I' luteo 
pursuant te- .Medicare Catai ' tropliio Cos orage Aet 
ef N8S, the minimum benefit ', shall t>e^ 

f-1-^ Co' i cruge »f R*h4 A Medicare eligible e^*- 
pensos fof hospitali/.ation k» the extent 
net co>ered by- .Medicare from the 6-hit 
4«y through the HOth tkty m a«y .Medicare 
benefit penod: 
f4+ Co' i erage fof either aH- ef ncme trf the 
M e dicar e Part A inpatient lu) '' pital 
deductibl e amount: 
f^ Coverage b( -Prtft A .Medicar e ehgible e*- 
penses incurred a^ daily hospital charges 
during H^^ el Medicare's lifetime hospital 
inpatient reserve days; 
f4f L pon odiaustion ef att Medicare hospital 
inpatient co' . erag e including the lifetime 
resen e days, ccv i erage h4 W percent ef aH- 
Medicare Pwft A eligible expenses frt* 
hospitalisation ftet covered l?y Medicare 
subject te a lifetime maximum benefit ef 
aft additional M*^ day: . ; 
(4} Coverage under Medicare Part A fof the 
reasonable ee-rt t+f the fif^t three pints ef 
blood fef equi' i 'alent quantities ef packed 
fe4 blood c e lls, a* defined und e r federal 
regulations) unl e ss replaced m accordanc e 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



II JO 



PROPOSED RULES 



wxih fodLTiil rL ' gulution 'i t+f alroudy paid fof 
undi. ' r -Pert ft^ 
f6-> (iviL'ruiju fof t+k* coinsurance amount »f 
Mc'dicaro olioibk ' uxpL'ni i O ' i iiiidiT Part i4- 
regardlecif . t+f ho '^ pital ccuifinL'inL'nt, ■. uhjk.'ot 
to- a maximum cait ' ndar waf out of 
pockot amount equal ?«• (4w Modicaro -Prtrt 
ft d e ductiblt * | ; ' it " > ' ij nty fisi ' dollar *. 
(^75 n( ) )|. Included ' .vi lhin th+-. pro' i i '. ion 
» coverage fof t4tt» coin ' jUranct > amount 
f3f> porcont) ef Modicaro oliablo oxpanooo 
fof oovltlhI outpatient drugii ur . L'd ift 
imnuino '. upproi .'. i' i 'o tliLTapy. 'l ubjoct t& 
t4tt» Modicaro Lleductible amount: 
{p-f I'lloctivo JanuaP i 4-: I'JOO, coserago under 
Medicar e Part ft fof tfee reaL . onablo sest- 
et-' Ae ftf^t- three pints e>f blood f©f equis' 
alent cinantities t4 pack e d Ft*4 blood cell ' . . . 
a^ LleTined under federiil regidation '. ). ««- 
k^i^ replaced h+ acctirdance V i ith federal 
r e gulations ef already pa*4 fof under Part 
At ■. abj e ct te- t4+e Medicare deductible 
amount. 
(44 (jeneral Re(.|uiremenls. 
f4-^ ^V(r> krt<M^ tiwft .lanuap r rW-r I'^^JQ, ovepy 
insurer, health ea*e servico plan ef other 
entil> pro' i iding Medicare Supplement i«- 
surance <-vf benefits to- a re -. ident wf th+s 
stat e shall notify it^ polic . holders, con 
tract hoklers a«4 certificate holders ef 
modifications it has inado to- Mcdicaro 
Supplement in '. iirance polici e s ef con 
tracts. Such notice shall b^* h* a fomiat 
pre .- cnbed by t4+e Commis '. ioner t*F h* tkn:* 
fonnat adopted by f4*i* NiVlCr (lonn A-^ 
if He- other format i* pr e scribed by t4*e 
Commissioner. 

(tV^ Such notice shall include a description 
»f re' i 'iL . ions te- t+H* .Medicare program a«4 
a d e scnption ef each modification made 
te the coverage provided under t+n* Medi 
eafe Supplement uisurance policy ef con 
tract. 

fB4 -^f-fe* notice shall infonn e ach co' i ered 
person as to when aftv premium adjust 
ment tft+e te changes h* Medicare benefits 
vvtft be effectne. 

fGf -1-be n>)lic e »f benefit modifications a«4 
afty premium adjustments shall be i» 
outline tomi a«4 h* clear »«4 '. imple tenns 
se as ^ hicililale comi^reheii '. ion. 

(4i+ Such notic e sluill Ht+t contain t-vf b<* ae- 
companied by a«¥ solicitation, 
Qr\ Xe- modiilcationo te aw- existing Medicare 
Supplement contract ef policy shall be 
made at- tkie t+me ef ef m- cixrnection Vp+t4+ 
the notice requirements ef' thts Regulation 



e xcept te f4te extent necei . sary te- iicconi 
plish the- puiposes ef t4HS Regulation. 
fe-)- I'omi a«4 Rat e filing Requirements: As 
soon as practicable, bwt fte longL ' r than -14 tia^ 
alter the et fee live date i+f tl*e .Medicare ' benefit 
chang e s, e' l 'eiy insurer, healtli eaf© ser' i 'ico plas 
ef other entity providing .Medicare Supplement 
in -i urance ef contracts i«- thts state shall h+e vrttk- 
the Department, ifi- accordance vsith the applicci 
b+e fling proc e dure ef this state: 

(4^ ;\ppropnate premium adjustments neco; . 

safv ttv produce foss ratios as onginallv 

anticipated fof the applicable policiu i. w 

contracts. Such - juppoiling documents its 

necessar; . te justify tkie adjustment shall 

accompany the filing. 

f4| Aȴ appropnate nders. endorsement f . w 

policy forms needed te- accomplish the 

.Medicare Supplement inMirance mo dill 

cations necessaPi t«- eliminate b e nefit tki- 

jilicationi . with .Medicare k*B4 te pros ide 

the benefits , required by I'aragraphs i^ 

(4*4 aft4 fe4 ef tbts Rule. Aftv such rid e rs, 

endor '. ements ef policy forms '. hall pfe- 

¥t>ie a clear de ' .icnption t4 the Medicare 

Supplement benefits provided by- the pek 

ley- ef contract. 

4+ L pon sati '. tying the tiling [and iipi'iros til l pe- 

quirements ef thts ' . . tate. e' . eiy insurer, health eaw 

service plan t+f other entit>' providing .M e dicare 

Supplement iu '. urance m th+s .. tale i. hall pros ide 

each covered person w ith afiy rider, endor '. ement 

t*f policv tonn neccsary h-f make the adjiu . tmenls 

outlined m- I'aragiaphs (t*^ (4*| aft4 H-)- »f thts 

R«le. 

(-g4 Any- premium adjustments shall produce 
a«- expected foss ratio under such pcUicy t+f een- 
tract as Vr+H- confonn v . ith minimum less ratio 
standards fof .Medicare Supplement policies aft4 
shall re '. ult fo aa expected foss ratio at leas . t as 
great as that originally anticipated by the insurer, 
h e alth eafe servic e plan »f oth e r e ntitv fof such 
Medicare Supplement insuranc e policies . t*f eeft- 
tract '. . Premium adjustments may be calculated 



fof the p e riod commencing with Medicare bonelit 
chau ' -ie ; 



(4f4 Offer ef Reinstitution ©f Coverage: 
(-4-)- I'xcept as provided ift Subpanigraph f4) 
t4 thfs Paragraph, fo the ease h4- aft- indi 
vidual who ha4 ift- effect, as ef Docemb e r 
4+T 1'^ ' ''mS. a Medicare supplem e ntal policy 
with aft- insurer (-as a polic;, holder efr wt 
the ea-^ ef a group policv . a-r a cedilical e 
holder) affo the indiv idual lerminat e tt 
coverage under such policy before thetktte 
t4' tkte enactment (4 the repeal ef the 
Medicare Catiistrophic Coverage Aet af 
4-ttJ^ the insur e r shafo 



IBl 



6:16 NORTH CAROLINA RECLSTER November 15, 1991 



PROPOSED RULES 



{A^ ProsiJ e svrittcjn notic e »» carliiT than 
Docembor 44r 1QS9. im<A He bto^ U»ft 
January ^ 1 9^0, to ^w policyholder ef 
cortiricato hold e r (a4- Ae moot rocont 
availabl e addroo ' ; . ) »f the »Sef describ e d m 
Subparagraph fR^ »f A» Paragraph; »«4 

fB^ Offor y+e indis'idual, during a period ei 
at- lea^ 60 day* beginning He4' krtef AtH* 

(with covLTago efTt ' otiv e a* e4^ Januap .' -K 
lOQO), under tormr . vvhich: dofte^ provide 
fef afty- waiting period with respect t» 
treatment ef pre existing conditions: pfe- 
vi4e fof coverage which vs substantially 
equivalent t«- coverage m effect before the 
dtrte ef ouch tonninalion; afl4 provide fof 

/'I -1 t- .-- 1 t < . "^ f ■ .-* f» r-v r ft «-i .»-n ■ I 1 j-»T 1' ."1 fi t^^QT^ II r t-i 1 . ■ 1-1 
CTTr^TTTT^TTTTTTTT rTT ['Tt-Ii IIUI ilJ r^TT rCTTTTTT Tl I 1 1 <^ 1 1 

afe a* least a* favorabl e to Ae 
poUcyholJer 9f certificate holder a« Ae 
premium olassil'ication terms t4*at- would 
have applied to Ae policyholder (*f ceil if 
icate holder bt*4 y*e coverag e never te*- 
minated. 
(3) Aft insurer » fto+ required te mak e Ae 
offer under Subparagraph f4^ (r4 tfei* I'ar 
a graph i«- the ewre ef a» individucd who i* 
a policyholder »f certificate holder m afi- 
other Medicare supplemental policy a* ©f 
January -H I'J'X), if (4+e individual i^* ftet- 
subject to a wailing period with respect to 
treatment ef a pre existing condition Hfi- 
deF such other policy. 

Stamoty Authority G.S. 58-2-40; 5S-54-I0. 

.0834 pk.kmhied compensation 

AKR.\NC;EMENrS 

(a) As used in this Rule: 

(1) "Compensation" means consideration or 
remuneration of any kind relating to the 
sale or renewal of a policy, incluciing but 
not limited to commissions, bonuses, 
gifts, prizes, or awards. 

(2) 'Policy" includes a certificate. 

(3) ''Representative" includes an agent, gen- 
eral agent, manager, broker, or other pro- 
ducer. 

(b) A person An issuer may pro\ide compen- 
sation to a representative for the sale of a policy 
only it~ the compensation for the first year or pe- 
riod is no more than 200 percent of the com- 
pensation provided in the second year or period. 

(c) The compensation pro\ idcd in subsequent 
renewal years or periods must be the same as that 
provided in the second year or period and must 
be provided for ae* le* no fewer than fo«f sub 
sequent fi\e renewal years or periods. 



(d) If a policy is replaced, no person shall pro- 
vide and no representative shall receive compen- 
sation greater than that payable by the replacing 
insurer issuer on renewal policies. This Para 
graph does »»<■ apply if Ae b e nefit;; evf t^w Fe- 
placetnent policy afe clearly att4 ii ubstantiully 
greater than t+H» benefits ef Ae replaced policy. 

fef Pach insurer shall establish mark e ting pf»- 

;-■,-» rl 1 1 »-.» , i ll -I t I- j-1* T .-v«-l Vi ■ 1 «^ ^ . t , • Ti ■-! T 1 1 L • rt-\ l\r T . i «~m i i I - i 4 ; i j- 
L. \_TJ Ul \_ ,' 1 1 ILL L ^T\. I rTTTTTT tT rTTCTTTTTCrTTTTTTTT \} I 1 V ' I 1 1 1 LI I II 1 1. ' I 

dotomiining whether replacement policies con 

the benefits ef replaced pohcies. 

Statutory Authority G.S. 58-2-40; 58-54-J5. 

.0835 MINIMLM BKNEFPr STANDARDS ON 
OR AFTER JANl ARY I, 1992 

The following standards are applicable to all 
Medicare supplement policies or certificates de- 
livered or issued tor delnerv in this State on or 
after January L \9'^2. No policy or certificate 
may be advertised, solicited, delivered, or issued 
for delivery in this State as a Medicare supple- 
ment policy or certiticate unless it complies u ith 
these benefit standards. 
( 1) (ieneral Standards. The following stand- 
ards apply to Medicare supplement policies 
and certificates and are in addition to all 
other requirements of this Section, 
(a) A -Medicare supplement polic\ or certif- 
icate shall not exclude or limit benefits for 
loss incurred more than six months from 
the effective date ot' coverage because it 
in\olvcd a pre-existing condition. The 
policN or certificate may not deline a pre- 
existmg condition more restnctivelv than 



a condition for u hich medical advice was 
given or treatment was recommended by 
or received from a physician within six 
months before the effective date of cover- 
age. 

(b) A Medicare supplement policy or certif- 
icate shall not indemnify against losses 
resulting from sickness on a ditferent basis 
than losses resulting from accidents^ 

(c) A Medicare supplement polic\ or certif- 
icate shall provide that benefits designed 
to cover cost shanng amounts under 
Medicare will be changed automaticalK to 
coincide with anv changes in the applica- 
ble .Medicare deductible amount and 
eopavnient percentage taclors. Premiums 
may be modified to correspcmd with such 
changes, but new premiums must be tiled 
and approved by the Commissioner be- 
fore use. 

(d) No .Medicare supplement policy or certif- 
icate shall provide for temiination of cov- 



6:16 NORTH CAROLINA REGISTER November 15, 1 99 1 



U.U 



PROPOSED RULES 



erage of a spouse solely because of the 
occurrence of an event specified for ter- 
miiKiticin of coveraije of the insured, other 
than nonpayment of premium, 
(e) h'ach Medicare supplement policy shall be 
guaranteed renewable and: 

(i) Ihe issuer shall not cancel or nonrenew 
the policy solel\' on the izround of health 
status of the indnidual. 

(ii) The issuer shall not cancel or nonrenew 
the policy lor any reason other than non- 
pa\ment of premium or material misrep- 
resentation. 

(m) If the Medicare supplement policy is 
terminated by the eroup policyholder and 
i^ not replaced as pro\'ided under Subpar- 
agraph ( I )(c)(v) of this Rule, the issuer 
shc-dl offer each certificateholder an indi- 
\idual Medicare supplement policy that, 
at the option of the certificateholder: 

(A) I'roN ides for continuation of the 
benefits contained in the group policy, 
or 

(B) Fro \ ides for such benefits as other- 
wise meet the requirements of this 
Rule. 



(iv) If an indi\idual is a certificateholder in 
a group .Medicare supplement policy and 
the indiyRkud tenninates membership in 
the group, the issuer shall either: 
(A) OlTer the certificateholder the con- 
\ersion opportunit\ descnbed in Sub- 



paragraph ( 1 |(e)(iii) of this Rule; or 
(B) At the option of the group 

polic\holder. offer the certificateholder 

continuation of co\erage under the 

group policy. 
(\') If a group .Medicare supplement policy 
IS replaced by another group .Medicare 
supplement policy purchased by the same 
policxholder. the succeeding issuer shall 
offer co\erage to all persons who were 
co\ered under the old group policy on its 
date of termination. Cro\erage under the 
new policy shall not result in an\' e\clu- 



(II 



sion for pre-exjsting conditions that would 
haye been covered under the group policy 
being replaced. 

dermination of a Medicare supplement 
policy or certificate shall be without prej- 
udice to any continuous loss that com- 



menced while the polic\' was in force, but 
the extension of benefits be\ond the pe- 
nod during which the policy was in force 
may be conditioned upon the continuous 
total disability of the insured, limited to 
the duration of the polic\' benefit period. 



if any, or payment of the ma.ximum ben- 
efits^ 
(g) Suspension During Medicaid Eligibility. 
(i) A Medicare supplement policy or certif- 
icate shall provide that benefits and pre- 
miums under the policy or certificate shall 
be suspended at the request of the 
policsholder or certificateholder for the 
penod. not to exceed 24 months, in which 
the pohcyholder or certificateholder has 
applied for and is determined to be enti- 
tled to medical assistance under lille .\1X 
of the Social Security Act, but only if the 
policyholder or certificateholder notifies 
the issuer of such pohcv or certificate 
within 90 days after the date the individual 
becomes entitled to such assistance. 
Lpon receipt of timely notice, the issuer 
shall return to the policyholder or 
certificateholder that portion of the pre- 
mium attnbutahle to the penod of 
.Medicaid eligibility, subject t£ adjustment 
for paid claims. 



(ii) jt such suspension occurs and if the 
policN holder or certificateholder loses 
entitlement to such medical assistance, 
such policy or certificate shall be auto- 
matically reinstituted ( effect ive as of the 
date of tennination of such entitlement) 



aich entitlement 



as of the termination of 

if the policyholder or certificateholder 
provides notice of loss of such entitlement 
uilhin 211 das s alter the date of such loss 
and pays the premium attributable to the 
period, effective as (2f the date of termi- 
nation ot such entitlement. 



(ill) Reinslitution oi_ such coverages: 

(A) Shall not provide for any waiting 
penod with respect to treatment of pre- 
existing conditions: 

(B) Shall provide for co\'erage that is 
substantiall\ equivalent to coverage in 
effect before the date of such suspen- 
sion: and 

(C) Shall provide for classification of 
premiums on terms at least as favorable 
to the pohcvholder or certificateholder 
as the premium classitication terms that 
would have applied to the policyholder 
or certificateholder had the coverage not 



(2) 



been suspended. 
Standards for Basic 



(''Core") Benefits 



Common to .All Benefit Plans: l-'verv issuer 



shall make available 



icy or certificate 



a policy or 



core 



including only the following basic 

package of benefits to each prospective in- 
sured. An issuer may make available to 
prospective insureds any of the other .Medi- 



llii 



6:16 iXORTH CAROLINA REGLSTER November /5, 1991 



PROPOSED RULES 



care Supplement Benefit I'lans in addition 

to the basic "core" pac' 

thereof. 



kasc^ but not in lieu 



(e) One 
(a) Co\era^c of Part A Medicare eligible ex- I'art B 



penses for hospitalb,ation to the extent 
not covered bv Medicare from the 61st 
day ihrou-jh the 9IHh dav in any Medicare 
benefit period; 

(b) Coverage of Part A Medicare eligible ex- 
penses incurred for hospitalization to the 
extent not covered bv Medicare for each 
Medicare lifetime inpatient reserve day 
used: 

(c) I pon odraustion of the Medicare hospital 
inpatient co\crage including; the Lifetime 
reserve days, coverage of the .Medicare 



Part 



A 



eligible 



<penses for 



hospitalization paid at the Diagnostic Re- 
lated Ciroup ( D R C ; ) da\ outlier per diem 
or other appropriate standard of pa\ment, 
subject to a lifetime maximum benefit of 
an additional jt^'^ days; 

(d) Coverage under Medicare Parts A and B 
for the reasonable cost of the first three 
pints of blood (or equivalent quantities of 
packed red blood cells, as detlncd under 
federal regulations) unless replaced m ac- 
cord^mce with federal regulations; 

(e) Co\erage for the coinsurance amount of 
Medicare eligible expenses under Fart B 
regardless of hospital confinement, subject 
to the Medicare Part B deductible. 

(3) Standards for .Additional Benefits. The 
foUowm.g additional benefits shall be m- 
cluded in Medicare Supplement Fk'nefit 
Plans "B ' through "J" only as provided by 
11 NCAC 12 .(1836. 

(a) .Medicare Part A Deductible: Coverage for 
all of the Medicare Part A inpatient hos- 
pital deductible amount per benefit pe- 
nod. 

(b) Skilled Nursing facility Care: Coverage 
for the actual billed charges up to the 
coinsurance amount from the 21st dav 
through the 1 00th da\ in a Medicare ben- 



efit penod for post hospital skilled nursing 
lacilitv care eligible under .Medicare Part 
A. 

(c) Medicare Pail B Deductible: Coverage for 
all of the .Medicare Part B deductible 
amount per calendar \ ear regardless of 
hospital confinement. 

(d) I'iglitv percent ot the Medicare Part B 
Pxcess Charges: Coverage for 80 percent 
of the difference between the actual .Med- 



icare Part B charge as billed, not to exceed 
any charge limitation established bv the 



01 



(2] 



in 



Medicare program or state law, and the 
■Medicare-approved Part B charge. 
One 1 lundred Percent of the Medicare 
Part B Pxcess Charges: Coverage for all 
of the difference between the actual .Med- 
icare Part ]} charge as billed, not to exceed 

any charge limitation 

.Me dicare program or State law 



estabhshed by the 
tnd the 



Medicare-approved ['art ]] charge. 
Basic Outpatient I'rcscnption Drug Bene- 
fit: Coverage for 50 percent of outpatient 
prescnption drug charges, after a two 
hundred fifty dollar ($250.00) calendar 
year deductible, to a maximum of one 
thousand two hundred fift\ dollars 
(SI. 250) in benefits received by the in- 
sured per calendar year, to the extent not 
covered by Medicare, 
t'xtended Outpatient Prescription Drug 
Benefit: Coverage for 50 percent of out- 
patient prescnption drug charges, after a 
two hundred fifty dollar (t250.OO) calen- 
dar year deductible to a maximum of three 
thousand doUars (S3. 000) in benefits re- 
ceived by the insured per calendar \ear. to 
the extent not covered by .Medicare, 
(h) .Medically Necessar\' Fmergencv Care in 
a foreign Country: Coverage to the ex^ 
tent not covered by Medicare for NO per 



cent of the billed charges for .Medicare 
eligible expenses for medically necessary 
cmergencv hospital, physician and med- 
ical care received in a lb reign countr\ , 
which care would have been covered by 
Medicare if provided in the I "nited States 
and which care began dunng the first 60 
consecutive davs of each trip outside the 
L. nited States, subject to a calendar year 
deductible of two hundred fifty dollars 
( t250,0()) and a lifetime maximum benefit 
of fifty thousand dollars (S50.00()). I -or 
purposes of this benefit, "emergency 
care" means care needed immediately be- 
cause of an injury or an illness of sudden 
and unexpected onset. 
Preventive Medical Care Benefit: Cover- 
age for the following preventive health 
services: 
(i) An annual clinical preventive medical 
history and physical examination th:it 
may include tests and sen ices from Sub- 
paragraph (3)(i)(ii) of thl^ Rule and pa- 
tient education to adiiress preventive 
health care measures. 



(ii) .Any one or a combmation of the fol- 
lowing preventive screening tests or pre- 
ventive services, the frequency of which is 
considered medically appropriate: 



6:16 ISORTH CAROLINA REGISTER November 15, 1991 



1134 



PROPOSED RULES 



(A) Fecal occult blood test and or di.gital 
rectal examination: 

(B) Mammoizrarn: 

(C) Dipstick unnalvsis for hematuria, 
bactenuna and proteinauna: 

(D) Pure tone (air only) hearini: screen- 
ing test, administered or ordered bv a 
phvsici.in: 

(V) .Serum cholesterol screening (e\cr\' 

the \ears): 
(I') I hsroid function test: 
(G) Diabetes screenini;. 

fiii) Influenza \'accine administered at anv 
appropnate time dunng the \ear and 
I'etanus and Dipthena booster (e\^e^v ten 
years). 

(iv) .Any other tests or pre\'enti\'e measures 
determined appropnate b\ the attending 
physician. 

Reimbursement shall be for the actual 
charges up to 10(1 percent of the 
Medicare-apprQ\ed amount for each ser- 
\ice. as if .Medicare were to co\'er the ser- 
yice as identified in .American Medical 
.Association Current Procedural Tenni- 



noIogN' I . A M A C'P 1 ) codes. t£ a ma>d- 
mum ot^^ one hundred twenty dollars 
(? 120.01)) annually under this benetit. 



Ill 



Ihis benefit shall not include payment for 
any procedure co\ered by Medicare. 
.At- Home Reco\er\ Benetit: (."o\ erage for 



ser\ices to provide short term at-home 
assistance with actnities of daily liMng tor 
those reco\enng from an illness, in|ur\ or 
surgerw 



(i) lor purposes of this benefit, the follow- 
ing dehnitions shall apply: 
(A) ".ActiMties of daily liyjng" include 
but iu'e not hmited to bathing, dressing. 



personal h\ giene, transfemng. eating, 
ambulating, assistance with drugs that 
are normalh" seLt-administered. and 
changing bandages or other dressings. 



(B) "Care proxider" means a duK quali- 
fled or licensed home health 
aide homemaker. personal care aide or 
nurse provided through a licensed home 
health care agenc\' or reterred by a h- 
censed referral agenc\" or licensed nurses 
registry. 



(C) iiome" means any place used by the 
insured as a place of residence, proyided 
that such place would qualilV as a resi- 
dence lor home health care ser\'ices 
covered bv Medicare. A hospital or 
skilled nursing facility shall not be con- 



sidered the msured s place of residence. 



(D) "At-home recovery visit" means the 
penod ol a visit required to provide at- 
home recovery care, without lunit on 
the duration of the visit, except each 
consecutive four hours m a 24-hour 
penod of serMces provided bv a care 
provider is one visit, 
(ii) Coverage Requirements and Limita- 
tions. 

(A) At-home recovery services provided 
must be pnmanlv services that assist in 
activities of daily living. 

(B) The insured's attending physician 
must certify that the specific type and 
trequencv of at-home recovery services 
are necessary because of a condition for 
which a home care plan of treatment 



was approved by .Medicare. 
(C) Coverage is limited to: 

(I) No more than the number and type 
of at-home recovery visits certified as 
necessary bv the insured's attending 
physician. The total number of at- 
home reco\'er% visits shall not exceed 
the number of Medicare-approved 
he)me health care visits under a 
Medicare-approved home care plan 
of treatment. 

(II) The actual charges for each visit 
up to a maximum reimbursement of 
forty dollars ($4().I10) per visit. 

(III) One thousand six hundred dollars 
(Sl.bOO) per calendar year. 

(I\') Seven visits in anv one week. 

(V) Care furnished on a visiting basis 
in tfic insured s home. 

( \" 1 ) Serxiccs provided bv a care pro- 
vider, as defined in this Rule. 

(VII) At-home recover^' visits while the 
insured is covered under the policy 
or certificate and not otherwise ex- 
cluded. 

(VIII ) .At-home recovery visits received 



dunng the penod the insured is re- 
ceiving .Medicare-approved home 
care ser\iccs or no more than eight 
weeks after the service date of the last 



Medicare-approved home health care 
visit, 
fiii) Coverage is excluded for: 

(A) Mome care visits paid for bv .Medi- 



care or other gov eminent programs: 

and 

(B) Care provided bv famih' members, 

unpaid volunteers or providers who are 

not care providers. 

(k) New or Innovative Benefits: .An issuer 

may, with the pnor approval of the 



11^5 



6:16 i\ORTH CAROLINA REGISTER November 15, 1*^91 



PROPOSED RULES 



Commissioner, offer policies or certificates 
with new or inno\'ati\'e benefits in addi- 
tion to the benefits provided in a policy 
or certificate that otherwise complies with 
the applicable standards. Such new or 
inno\ali\e benefits may include benefits 
that arc appropnate to .Vledicare supple- 
ment insurance, new or innovati\e. not 
otherwise a\'ailable. cost-etTecti\'e, and of- 



fered in a manner that is consistent with 
the yoal of simplification of Medicare 
supplement policies. 



Statutoty 
58-54-15. 



Authority G.S. 5S-2-40; 5S-54-I0; 



.0836 Sr.WDARD MEDICARE SLPPLEMENT 
BENKI 11 I'LANS 

(a) An issuer shall make available to each pro- 
specti\e policyholder and certificateholder a pol- 
icy form or certificate form containing only the 
basic "core" benelits. as defined in _!_[_ NC.AC 12 
.0835(2). 

(b) No groups, packages, or combinations of 
Medicare supplement benefits other than those 
listed in this Rule shall be offered for sale in this 
State, except as mav be pennitted in j_l_ NC.AC 
12 .U835(3)(k). 

(c) Benefit plans shall be unifonn in structure, 
language, designation, and fomiat to the standard 
benefit plans ' .A" through ".I" listed m this Rule 
and confonn to l_he definitions in G .S 58-54- 1 
and 11 NC.AC 12 .(1815. 



lach benefit shall be 
structured in accordance with the tbrmat pro- 
vided m 1 1 NC.\C 12 .0835(2) and (iy and the 



policy shall list the benefits in the order shown 
in this Section. for purposes of this Rule, 
"structure, language, and format" means st\le, 
arrangement, and o\crall content of a benefit. 



(d) An issuer may use, in addition to the ben- 
efit plan designations required m Paragraph (c) 
of this Rule, other designations to the extent 
permitted by law. 

(e) .Make-up of benefit plans: 

( 1) Standardized Medicare supplement bene- 
fit plan ".A" shall be limited to the basic 
("core") benefits common to all benefit 
plans, as defined m 1 1 NCAC 12 .0X35(2). 
Standardized .Medicare supplement bene- 
fit plan "B ' shall include only the follow- 
ing: The Core Benefit plus the .Medicare 
Part A Deductible as defined in _n NCAC 
12 .083.M3)(a). 

Standardized Medicare supplement bene- 
fit plan "C" shall include onl\- the follow- 



Qi 



(3) 



ing: The Core Benefit plus the .Medicare 
Part A Deductible. Skilled Nursing i'aeil- 
ity Care. Medicare Part B Deductible and 



Medically Necessary ['mergency Care m 
a foreign Countr\ as delined in 1 1 
NCAC 12 ■0835(3)(a). (b). (p. and (h) 
respectively. 
(4) Standardized .Medicare supplement bene- 
tit plan "D" shall include onh' the fol- 
lowing: The Core iJenefit plus the 
Medicare Part A Deductible. Skilled 
Nursing Pacilitv (?are. .MediealK' Neces- 



sary f mergencv Care in a foreign Coun- 
try' and the At- Home Recovery Ijenelit as 
dcfmed in \A NC.AC \2 .0835(3)(a). (b). 
(h). and (j) respectively. 
(5) Standardized .Medicare supplement hene- 
fit plan "F. ' shall include onh the lollow- 
ing: fhe Core Benefit plus the .Medicare 



Part A Deductible, Skilled Nursing l-'acil- 
itv Care. .Medically Necessan f mergencv 
Care in a foreign Country and Pre\enti\e 
.Medical Care as defined in 11 NC.AC 12 



ihl 



.0835(3)(a). (b). (h). and [n respecti\-el\-. 
Standardized .Medicare supplement bene- 
tit plan "1-" shall include onh the follow- 
ing: I he Core Benefit plus the .Medicare 
i'art A Deductible. Skilled Nursing j-acil- 
itv Care, the Part B Deductible. 100 per- 
cent of the .Medicare Part B 1 xcess 
Charges, and .Medicalh Necessary limer- 



gency Care in a foreign Ccuintrx as de- 
fined in 11 .NC.AC 12 .(iS3>(3)(a). (b). (c). 



(e). and (h) respeetiveh . 
(7) Standardized Medicare supplement bene- 
ft plan "(i" shall include onh the fol- 
lowing: fhe Core Benefit plus the 
Deductible. Skilled 



The 

Medicare Part 



A 



Nursing facility Care, 80 Percent of the 
■Medicare Part B I: xcess Charges. .Med- 
Necessarv F'^mergenc^v Care in a 
At- Home Re- 
12 



1 NC.AC 



Uii 



til 



icallv 

foreign Country, and the 

coNcrv Benefit as defined in 

.0S35(3)(a). (b), (d). (h), and (j_) respec- 
tively. 

Standardized Medicare supplement bene- 
flt plan 1 1 " shall consist o^ onh the lol- 
lowing: fhe Core Benefit plus the 
Medicare Part A Deductible. Skilled 
Nursing facility Care. BaMc Prescnplion 
Drug Benefit and .Medic:ill\ Necessar\' 
f mergenc\ Care m a foreign Country as 
defined m JJ_ NCAC \1 .i)S35(3)(a). (b), 
(f). and (h) respeetiveh. 
Standardized Medicare supplement bene- 
fit plan "1" shall consist tj^ onh" the fol- 
lowing: fhe Core Benefit plus the 
" '' l!il]l A Deductible. Skilled 



lowing 

■Medicare ._^ ... _ 

Nursing facility Care. 100 Percent of the 
Medicare Part ]5 t: xcess Charges. IJasic 
Prescription Drtig Benefit. .Medically 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



1136 



PROPOSED RULES 



Necessary Fmcrs;encv Care in a Foreign 
Country and At -Home Recovery- Benefit 
as Jcfined in ]_!_ NCAC _12 .0835(3)(a), 
(b). (e). (f), (h). and £l1 respectively. 
( 10) Standardized Medicare supplement ben- 
efit plan "J" shall consist of only the fol- 
louina: The Core ik-ncfit plus the 
Medicare Fart A Deductible, Skilled 
Nursinjj I'acilitv Care, Medicare Fart H 
Deductible, lUO percent of the Medicare 
Fart B l-'xcess Charucs, Itxtcnded Pre- 
scription Dru" ik'nefit, Medically Neces- 
sary l:mcr,aencv Care in a F-'oreign 
Country, Preventive Medical Care and the 
At- Home Recovery' Bcnctlt as defined m 
11 NCAC 12 .nS35(3|(a). (b), (c), (e). (g), 
(h). (i). and (j) respectively. 



G.S. 5S-2-40; 5S-54-I0: 



Statutory Authority 
58-54-15. 



.0837 OPKN ENROLLMKNT 

(a) No issuer shall deny or condition the issu- 
ance or effectiveness of an\' Medicare supplement 
pohcv or certificate available for sale in this State, 
nor discnminate in the pncint; of such a poficy 
or certificate because of the health status, claims 
expenence. receipt of health care, or medical 
condition of an applicant where an applicant 
where an application for such policy or certificate 
is subinitted durint; the six-month penod begin- 
ning with the first month in which an individual 
(uho is aged 65 years or older) tirst enrolled for 
benefits under .Medicare l\trt B. Fach Medicare 
supplement policy and certilicate currently avail- 
able frtnn an issuer shall be made available to all 
applicants who qualify under this Rule without 
regard to age. 

(b) Paragraph (a) of this Rule docs not prevent 
the exclusion of benefits under a pohcv dunng 
the first six months, based on a pre-existing con- 
dition for which the policyholder or 
certificateholder received treatment or was other- 



wise diagnosed dunng the six-month period be- 
fore the polic\' became effective. 

Statutoty Authority G.S. 5S-2-40; 5S-54-I0. 

.0838 HI ING .AND APPRO\ AL OF 

I'OI ICIES/CERIIFICATES AND 
PRF.MILM RATFS 

(a) An issuer shall not deliver or issue for de- 
livery' a pc^licv or certificate to a resident of this 
State unless the policy form or certificate form 
has been filed m tnplicale with and approved bv 
the Commissioner in accordance with filing re- 
quirements and procedures prescnbed by statute 
or rule. 



(b) An issuer shall not use or change premium 
rates for a Medicare supplement policy or certif- 
icate unless the rates, rating schedule and sup- 
porting documentation have been filed with and 
approved by the Commissioner in accordance 
with the filing requirements and procedures pre- 
scribed bv statute or rule. 

(c) F'xcept as provided in Subparagraph (c)(1) 
ot this Rule, an issuer shall not file for approval 
more than one form of a policy or certificate of 
each type for each standard .Medicare supplement 
benefit plan. 

( 1) An issuer may offer, with the approval of 
the Commissioner, up to four additional 
policy forms or certificate forms of the 
same type for the same standard Medicare 
supplement benefit plan, one for each of 
the following cases: 

(A) "I he inclusion of new or innovative 
benefits; 

(B) "1 he additi^)n of either direct response 
or agent marketing methods; 

(C) 1 he addition of either guaranteed issue 
or underwritten coverage; 

(D) Ihe otfenng of coverage to individuals 
ehgible for .Medicare bv reason of disabil- 



Q 



ity. 
lor the purposes 



if this Rule, a "tvpe" 
means an indi\idual policy or a group 
pohcv. 

(d) Fxcept as provided in Subparagraph (d)(1) 
of this Rule, an issuer shall continue to make 
available for purchase any policy form or certif- 
icate form issued after January _f F)92, that has 
been approved by the Commissioner. A policy 
form or certificate form shall not be considered 
to be available for purchase unless the issuer has 
actively offered it for sale in die previous 12 
months. 

( 1 ) An issuer may discontinue the availability 
of a policy form or certificate form if the 
issuer provides to the Commissioner 
wntten notice of the issuer's decision at 
least 30 days before discontinuing avail- 
abililv . Alter the Commissioner receives 
this notice, the issuer shall no longer offer 
for sale the pohcv form or certificate form 
in this State. 

(2) An issuer that discontinues the availability 
of a policy form or certificate form pur- 
suant to Subparagraph (d)( 1) of tliis Rule 
shall not file for approval a new policy 
lorm or certificate form of the same tvpe 



for the same standard Medicare supple- 
ment benefit plan as the discontinued 
fonn for a period of five years alter the 
issuer provides notice to the Commis- 
sioner of the discontinuance. The period 



1157 



6:16 NORTH CAROLINA REGISTER Novcmba- 15, 1991 



PROPOSED RULES 



of discontinuance may be reduced if the 
(.Commissioner determines that a shorter 
period is appropriate and m the pubHc 
interest, 
(e) "Ihe sale or other transfer of a Medicare 
supplement business to another issuer shall be 
considered a discontinuance for the purposes of 
this Rule. 
yj A change in the rating structure or meth- 
odoloCT shaU be considered a discontinuance 
under Paraijaph (d) ol" this Rule unless the issuer 
complies with the follov\'ing requirements: 

(1) ['he issuer provides an actuarial memo- 
randum, in a form and manner prescribed 
bv the Commissioner. Jcscnbing the 
manner in which the re\iscd ratmg meth- 



11 me Y) 

lorter I\. 



odologv and resultant rates differ from the 
existing rating methodokxg^ and resultant 
rates. 



(2) The issuer does not subsequently put into 
effect a change of rates or rating tactors 
that would cause the percentage diffcren- 



tial between the discontinued and subse- 



quent rates as descnhed m the actuarial 
memorandum to change. 1 he Commis- 
sioner may appro\e a change to the dit- 
ferential that is in the public interest, 
(g) Relund or Credit Calculation. 

( 1) f'xcept as provided in Subparagraph (g)(2) 
of this Rule, the cxpenence of all policy 
fonns or certificate forms ot the same t\pe 
in a standard .Medicare supplement benefit 
plan shall be combined for purposes of 
the refund or credit calculation prescribed 
m 11 NC.AC 12 .()S22(b). 

(2) lonns assumed under an assumption re- 
insurance agreement shall not be com- 
bined with the experience of other forms 
for purposes of the refund or credit calcu- 
lation. 

Statutory Authority G.S. 58-2-40; 5S-54-20. 

TITLE 13 - DEPART.ME.M OE LABOR 

lyotice is hereby gh'en In accordance uith G.S. 
I50B-2I.2 that the Department of Labor intends 
to adopt nde(s) cited as 13 SC.4C 7C .0/07. 

1 he proposed effective date of this action is 
Fehnidty I. 1992. 

I he public hearing will be conducted at 2:00 
n.m. on December 13. 1991 at the Highway 
Building. Room 150. I S. Wilmington Street, 
Raleigh, A.C. 



eason for Proposed Action: To clarify that 
places of employment must be constructed and 
maintained in accordance with the State Building 
Code to satisfy OSH requirements. 

(_- omment Procedures: People wanting to pres- 
ent oral testimony at the hearing should provide a 
written summary of the proposed testimony to the 
Department by December 9, 1991 . Written com- 
ments will be accepted by the Department until 
December 15. I99L Direct all correspondence to 
Bobby Bryan, N.C. Department of Labor, 4 W. 
Edenton Street, Raleigh, .VC 2''60/. 

CHAPTER 7 - OFFICE OF OCCUPATIONAL 
SAFETY .\ND HEALTH 

SUBCHAPTER 7C - SAFETY AND HEALTH 

SECTION .0100 - GENERAL INDUSTRY: 
CONSTRUCTION AND AGRICULTURE 

.0107 STATE BUILDING CODE 

(a) Except as specified in Paragraph (b) of this 
Rule, all places of emplo\inent newly occupied 
after the etfecti\"e date of this Rule shall be con- 



structed and maintained in accordance with the 
standards set out in Volume I. General Con- 



struction Code, and \'olume V, Fire Prc\ention 
Code, of the North Carolina State Building Code 
( U)Q I l-dition). which arc hereby incorporated 
by reference. This incorporation shall not in- 
clude any subsequent editions or amendments of 
these volumes. Copies of these \'olumcs can be 
obtained from the North (Carolina Department 
of Insurance. Code Council Section. Post Olt'ice 
Pox 2b}Kl. Raleigh, \C 27611. The pnces are 
twenty ll\e dollars (t25.0()) for Voluine I and 
twenty dollars (^20. 00) for Volume V. 

(b) Volume I of the North Carolina State 
Building Code shaU be subject to the following 
modifications: 

( 1) Section 506.6.2.6. Sequential and Selec- 
tive Operation. .Add a sentence to read: 
"Ihdraulic elevators which do not ser\e 
more than three tloors shall be designed 
and installed with their own emergency 



power to complete the lowenng process." 
(2| Section 701.1.2. lable 7|)(). Mcvator shaft 
enclosures and elevator machine rooms 
shall ha\e a two-hour tire resistive rating 
and the opening protectnes shall ha\e a 
one and one-half hour tire resisti\e rating. 
(3) Section 2402.6 3. \'ents. Delete the last 
sentence in the first paragraph and add m 
its place a sentence to read as follows: 
'Vents may be closed when designed to 
be opened automaticalK' if a smoke de- 



6:16 NORTH CAROLINA REGISTER November 15, I99I 



113S 



PROPOSED RULES 



tcctor and heat detector located at the top 
of the hoistwav is acti\'ated." 

Statutoty Authority G.S. 95-131. 

TITLi: 15A - DKFAR IMKM OF 

ENMRONMKM, HEALTH, AM) 

NATURAL RESOl RCES 



l\ otice is hereby given in accordance with G.S. 
I50B-2I .2 that EHSR intends to amend rule(s) 
cited as !5A \CAC 7H .0306. 

1 he proposed effective date of this action is April 
I, 1992. 

1 he public hearing will be conducted at 4:00 
p.m. on December 12, 1991 at the Best Western 
Armada. Mile Post 17. Sags Head. \C 2^959. 

iXeason for Proposed Action: The reason for 
this proposed action is to amend the criteria used 
to define a large structure for purposes of deter- 
mining oceanfront setbacks. 



Co 



■ omment Procedures: .4 II persons interested in 
this matter is imited to attend the public hearing. 
The Coastal Resources Commission will receive 
written comments up until December J5, 1991. 
.'i ny person desiring to present lengthy comments 
is requested to submit a written statement for 
inclusion in the record of proceedings at the public 
hearing. Additional information concerning the 
hearing or the proposals may be obtained by con- 
tacting: Dedra Blackwell, Dh'ision of Coastal 
.Management. P.O. Box 276S7, Raleigh, AC 
27611-7687. (919} 733-2293. 

CHAPTER 7 - COASTAL \LVNAGEMENT 

SIBCIIAPTER 711 -STATE GLIDELINES FOR 
AREAS OF EN\ IKONMENTAL CONCERN 

SECTION .0300 - OCEAN HAZARD AREAS 

.0306 GENERAL LSE STANDARDS FOR 
OCEAN HAZARD AREAS 

(a) In order to protect life and property, all 
development not otherwise specifically exempted 
or allowed by law or elsewhere in these Regu- 
lations shall be located according to whichever 
of the following rules is applicable. 

( 1 ) If neither a primary nor frontal dune exists 
in the AEC on or behind the lot on which 
the de\elopment is proposed, the devel- 
opment shall be landward of the erosion 
setback line. The erosion setback line 



shall be set at a distance of 30 times the 
long-term annual erosion rate from the 
first line of stable natural \egetation or 
measurement line, where applicable. In 
areas where the rate is less than 2 feet per 
year, the setback line shall be 60 feet from 
the vegetation line or measurement line, 
where applicable. 

(2) If a primary dune exists in the AEC on 
or behind the lot on which the develop- 
ment is proposed, the development shall 
be landward of the crest of the primary 
dune or the long-term erosion setback 
line, whichever is farthest from the first 
line of stable natural vegetation or meas- 
urement line, where apphcable. For ex- 
isting lots, however, where setting the 
development behind the crest of the pri- 
mary dune would preclude any practical 
use of the lot, development may be lo- 
cated seaward of the priman.' dune. In 
such cases, the development shall be lo- 
cated behind the long-term erosion set- 
back line and shall not be located on or 
in front of a frontal dune. The words 
"existing lots'' in this Rule shall mean a 
lot or tract of land which, as of June 1, 
1979, is specifically described in a recorded 
plat and which cannot be enlarged by 
combining the lot or tract of land with a 
contiguous lot(s) or tract(s) of land under 
the same ownership. 

(3) If no primary dune exists, but a frontal 
dune does exist in the AFC on or behind 
the lot on which the de\eIopment pro- 
posed, the de\elopment shall be set be- 
hind the frontal dune or beliind the 
long-term erosion setback line, whichever 
is farthest from the first Une of stable na- 
tural vegetation or measurement Une, 
where applicable. 

(4) Because large structures located imme- 
diately along the Atlantic Ocean present 
increased risk of loss of life and property, 
increased potential for eventual loss or 
damage to the pubhc beach area and other 
important natural features along the 
oceanfront, increased potential for higher 
public costs for federal flood insurance, 
erosion control, storm protection, disaster 
rehef and provision of public services such 
as water and sewer, and increased difti- 
culty and expense of relocation in the 
event of future shoreline loss, a greater 
oceanfront setback is required for these 
structures than is the case with smaller 
structures. Therefore, in addition to 
meeting the criteria in this Rule for set- 



//.?9 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



PROPOSED RULES 



back behind the primar>' and/or frontal 
dune, for aW multi family rL": . iJ@ntial 
f . truL-tureo (including motolo, hotels, con 
dominiums aft4 motcli miniums) &f mor e 

t U ■ I T-v A iiT-.it. lit ^ (l()n "'nil "irp T I * I ' t t o t ""i I 

I I lU rr ~ U 1 1 1 1 J 1 ' I . " , '.". ' \7 JTJ LJUI l_ rC^TT rTTTOT 

floor ur e a. aH4 fof aft¥ non rLM . idontial 
C ' tructuro w+tfe a total afea any structure 
of more than 5,000 square feet, the ero- 
sion setback Line shall be twice the erosion 
setback described in .0306(a)(r) of this 
Rule, provided that in no case shall this 
distance be less than 120 feet. In areas 
where the rate is more than 3.5 feet per 
year, this setback line shall be set at a 
distance of 30 times the long-term annual 
erosion rate plus 105 feet. 
(5) Established common-law and statutory' 
public rights of access to public trust lands 
and waters in ocean hazard areas shall not 
be eliminated or restricted. Development 
shall not encroach upon public 
accessways nor shall it limit the intended 
use of the accessways. 

(b) In order to avoid weakening the protective 
nature of ocean beaches and primar>' and frontal 
dunes, no development wiU be permitted that 
in\ol\'es the significant removal or relocation of 
primary or frontal dune sand or vegetation 
thereon. If possible, other dunes within the 
ocean hazard area shall be disturbed only to the 
extent allowed by Rule .030S(b). 

(c) In order to a\oid excessive public expendi- 
tures for maintaining public safety, construction 
or placement of grov\'th-inducing public facilities 
to be supported by public funds \\ ill be permitted 
in the ocean hazard area only when such facili- 
ties: 

(1) clearly exhibit o\erriding factors of na- 
tional or state interest and public benefit, 

(2j will not increase existing hazards or dam- 
age natural butlers. 

(3) will be reasonably safe from flood and 
erosion related damage, 

(4) wlU not promote growth and development 
in ocean hazard areas. 

Such facihties include, but are not limited to, 
sewers, waterlines, roads, bridges, and erosion 
control structures. 

(d) Development shall not cause major or ir- 
reversible damage to valuable documented his- 
toric architectural or archaeological resources. 

e) Development shall be consistent with min- 
imum lot size and set back requirements estab- 
lished by local regulations. 

t) Mobile homes shall not be placed within the 
high hazard flood area unless they are within 

obile home parks existing as of June 1, 1979. 



(g) Development shall be consistent with gen- 
eral management objective for ocean hazard areas 
set forth in Rule .0303 of this Section. 

(h) Development shall not create undue inter- 
ference with legal access to, or use of, public re- 
sources. 

(i) Development proposals shall incorporate all 
reasonable means and methods to avoid or min- 
imize adverse impacts of the project. These 
measures shall be implemented at the apphcant's 
expense and may include actions that will: 

(1) minimize or avoid adverse impacts by 
limiting the magnitude or degree of the 
action, 

(2) restore the affected environment, or 

(3) compensate for the adverse impacts by 
replacing or providing substitute re- 
sources. 

(j) Prior to the issuance of any permit for de- 
velopment in the ocean hazard AECs, there shall 
be a written acknowledgement from the applicant 
that the applicant is aware of the risks associated 
with development in this hazardous area and the 
limited suitability of this area for permanent 
structures. By granting permits, the Coastal Re- 
sources Commission does not guarantee the 
safety of the development and assumes no Liabil- 
ity for future damage to the development. 

(k) \\\ relocation of structures requires permit 
approval. Structures relocated with pubhc funds 
shall comply with the apphcable setback Line as 
wcU as other applicable AFC regulations. 
Structures including septic tanks and other es- 
sential accessories relocated entirely with non- 
public funds shall be relocated the maximum 
feasible distance landward of the present location; 
septic tanks may not be located seaward of the 
primaPv' structure. In these cases, all other ap- 
plicable local and state rules shall be met. 



Statutory Authority G.S. 

II3A-Il3(b)(6): I13A-I24. 



I ISA- 10' 



TITLE 16 - OKPARIMENT OF PUBLIC 
FDUCAFION 

1\ otice is hereby ghen in accordance with G.S. 
I50B-2I .2 that the State Board of Education in- 
tends to amend nde(sj cited as 16 SCAC 6D 

.02/0. 

1 he proposed effective date of this action is 
March I. 1992. 

1 he public hearing will be conducted at 10:00 
a.m. on December 19, 1991 at the 3rd Floor State 



6:16 NORTH CAROLINA REGISTER November 15. 1 991 



1140 



PROPOSED RULES 



Board Room, Education Building, 116 West 
Edenton Street, Raleigh, NC 27603-17 12. 

Ixeason for Proposed Action: Rule is being 
amended pursuant to G.S. 1 15C-102 (amended 
1991). 

i^ ommcnt Procedures: .4ny interested person 
may present vievt's and comments in writing either 
prior to or at the hearing or orally at the hearing. 

CHAPTER 6 - ELEMENTARY AND 
SECONDARY EDLCATION 

SL BCHAF'TER 6D - INSTRUCTION 

SECTION .0200 - TEXTBOOKS 

.0210 DISPOSITION OF OLD TEX I BOOKS 

LHAs will dispose of »14 textbooks which are 
no longer hstcd on the stale-adopted textbook list 
as follows: 

(1) LEAs may not give textbooks replaced by 
a new adoption to any person, firm, or cor- 
poration or institution for use where tuition 
is charged or for resale except as provided in 
Subparagraph (3) of this Rule. 

(2) I'he LI: A may use these textbooks or give 
them to students for use as supplementary 
matenal. 

(3) The LliA may sell these textbooks only for 
scrap paper, etfui i4- must remit i+*e procoodu 
&f f4*# Department. 

(4) I.t^As mav donate out-of-adoption books 
to state sponsored adult education pro- 
grams, including educational programs sup- 
ported by other state agencies, and to 
non-profit agencies or organizations. 

(5) 11 As mav donate textbooks to non-profit 
organizations for use m foreign countnes to 
increase the general literacy of the people. 

Statutory .luthority G.S. II5C-S9. 

TITLE 21 - OCCl RATIONAL LICENSING 
BOARD 

lyotice is hereby given in accordance with G.S. 
150B-21.2 that the S.C. Stale Board of Certified 
Public Accountant Examiners intends to amend 
rule(s) cited as 21 NCAC 8K .0201. 



1 he proposed effective date of this action is 
March I. 1992. 

1 he public hearing will be conducted at 10:00 
a.m. on December 16, 1991 at the N.C. State 
Board of CP.4 Examiners, 1 101 Oberlin Road, 
Suite 104, Raleigh, NC 27605. 

JKeason for Proposed Action: This amendment 
would remove language that conflicts with 21 
NCACSG .0306. 



Co 



omment Procedures: Any person interested in 
this rule may present oral comments relevant to 
the action proposed at the public nde-making 
hearing or deliver written comments to the Board 
office not later than 5:00 p.m., December 2, 1991. 
Anyone planning to attend the hearing shoidd no- 
tify the Board office by 5:00 p.m. on December 
2. 199/ . whether they wish to speak on the pro- 
posal and whether they will speak in favor or 
against them. .Anyone speaking on the proposal 
will be limited to 10 minutes. 

CHAPTER 8 - BOARD OF CERTIFIED PUBLIC 
ACCOUNTANT EXAMINERS 

SUBCHAPTER 8K - PROFESSIONAL 
CORPOR.VriONS 

SECTION .0200 - PRACTICE PROCEDURES OF 
PROFESSIONAL CORPOR.\TIONS 

.0201 CORPORATE NAMES 

The corporate name of a professional corpo- 
ration registered under these rules shall contain 
the wording "corporation," "incorporated," 
"limited," "company," "professional corpo- 
ration," or "professional association," or an ab- 
breviation of one of the foregoing: "Corp.," 
"Inc.," "I td," "Co.," -P.C.," or "P.A". ¥he 
H^^ »f "CPA ' «*f "Cortifiod Public 
i\ccountant(s)" ift t4w corporat a numo is uncour 
ugod. btri- fte4- required. Ihe name shall also meet 
the requirements in 21 NCAC 8G .0305 and 
.0306. 

Statutory Authority G.S. 55B-5; 55B-/2. 



1141 



6:16 NORTH CAROLINA REGISTER November 15, 1 99 1 



FINAL RULES 



/i dopted rules filed by the Department of Revenue are published in this section. This department 
is not subject to the provisions ofG.S. I SOB, Article 2 requiring publication in the N.C. Register of 
proposed rules. 

tLffectix'e October I, 1991, the Departments of Correction and Revenue are subject to G.S. I SOB, 
Article 2A. The rules appearing in this section were fled prior to October 1 , 1991 and are not subject 
to the notice requirements. 

LJ pon request fom the adopting agency, the text of rules will be published in this section. 



TITLE 19A - DEPARTMENT OF TRANSPORTATION 

CHAPTER 1 - DEPARTMENTAL RULES 

SUBCHAPTER lA - ORGANIZATION OF THE DEPARTMENT 

SECTION .0200 - SECRETARY OF TRANSPORTATION 

.0204 PUBLIC AFFAIRS SECTION 

.0205 PERSONN,EL 

.0206 CrV IL RIGHTS COORDINATOR 

Histor\' Note: Statutory Authority G.S. 126-16: I43B-I0: 143B-348; 
Eff July I, 1978: 
Repealed Eff November I. 1991. 

SECTION .0400 - DIMSION OF HIGHWAYS 

.0404 DUTIES AND RESPONSIBILI LIES: STATE HIGirSVAY ADMINISTRATOR 

Historv Note: Statutory Authority G.S. 20-119; I33-S: 136 
-18.3; 136-18(5); 'l36-l8(ll); 136-19; 
136-28.1; 136-29; 136-30; 136-44.1; 136-64. 1(d); 
136-71.9; 136-71.10; I36-89.SI; I36-89.S9; 
136-93; 143B-I0(j); l43B-3S0(f). (g); 
Eff July I, 1978; 

Amended Eff January I. 1986: October 1, 1983; 
Repealed Eff November I, 1991. 

.0406 HIGHWAY PLANN«ING SECIION 

.0407 PROJECT MANAGEMENT AND PRODUCTFV ITY CONTROL SECTION 

.0408 OPERATIONS SECTION 

Historv Note: Statutory Authority G.S. 136-12; 136-14.1; 136-lS; 
136-17.2; 136-18; 136-19; 136-28.6; 136-44.2; 
136-44.2B; 136-44.4; 136-44.11; 136-44.50; 136-66.1: 
136-66.3; 136-66.5; 136-82: 136-89; 136-184: 
J43B-I0(bj,(g),(j); 143B-348: I43B-3S0; 
Eff July i: 1978; 
Amended Eff. November 1, 198S; 
Repealed Eff November I, 1991. 

SECTION .0500 - ASSISTANT SECRETARY FOR MANAGEMENT 



6:16 NORTH CAROLINA REGISTER Novembei 15, 1991 1142 



FINAL RULES 



.0501 IDKNTIFVrSG INFORMATION 

.0502 FINCTIONS 

.0503 TRANSPOR FAl ION CO.MPl TING CENTER SECTION 

.0504 FISCAL 

.0505 PURCHASING 

.0506 INFERNAL ALDIT 

.0507 0( CIPAIIONAL SAFETY AND EMERGENCY PLANAESG 

.0508 MANAGE.MENI ENGINEERING 

Histon- Sote: Statiuon Authority G.S. 20-3; 20-26; 20-27; 20-43; 
95-l26ibi(2}l; 95-127(10); 95-148; 136-10: 
143-49; 143-51; 143-15"; 143B-I0{b): I43B-348; 
Eff. July I, 19-^8; 

Amended Eff. Julv I. 1982; Julv I. 1981; 
Repealed Eff Xovember I, 1991. 

SECTION .0600 - ASSISTANT SECRETARY FOR PLAN>.ESG 

.0601 IDENFIFYING INFORMATION 

.0602 ELNCIIONS 

.0603 TRANSPORTATION SYSTEMS PLANN,ING SECTION 

.0604 BICYCLE AND BIKEW AY SECTION 

.0605 PI HLIC TRANSPOR FATION DIMSION 

.0606 IDENTIFYIN(, INFORMATION: DIMSfON OF AERONAUTICS 

.0607 FUNC I IONS: DIMSION OF AERONAUTICS 

.0608 AIRPORT DE\ ELOPMENT SECTION 

.0609 AIR TRANSPORTATION DEVELOPMENT SECTION 

.0610 AIR SAFEFY SECTION 

.0611 AERONAUTICS COL><CIL 

Histofy Sote: Statuton .Authority G.S. 113-28.5: 113-28.6; 113-28.12; 
136-44.20: 143B-I0i aj.i b I; l43B-350if).(gi; 
143B-355: 143B-356: 
Eff July 1, 19^8; 
Repealed Eff. Sorember 1. 1991. 

SECTION .0700 - DFV ISION OF MOTOR \ EHICLES 

.0701 IDENTIFYING INFOR.MAIION 

(a) 1 he principal office of the division of motor \ehicles is located at: 
Motor X'ehicles Building 

1 100 New Bern Avenue 
Raleigh, North Carolina 27697 

(b) The locations of other offices within this division, when such otTices are not located at the above 
address, are on lUe in the respecti\e Section main offices at the Motor \'ehicles Building in Raleigh. 

Histon Sote: Statutoty Authoritv G.S. 20-1; 20-3; 20-40; 
Eft: Julv I. 1978; ' 
.Amended Eff. Sovember 1, 1991. 

.0703 STRUCTURE OF THE DFV ISION 

The division s orgamzational structure consists of six section components: dri\er license, vehicle 
registration, enforcement, international registration plan (IRPj. collision reports general ser\'ices. and 
school bus and tralTic safety. 

History- Sote: Statuto/y .Authority G.S. 20-1 to 20-3: 
Eff July' I, 1978; ' 
.Amended Eff. Sovember I, 1991 . 



1143 6:16 NORTH CAROLLVA REGISTER November 15, 1991 



FINAL RULES 



.0705 DRrV ER LICENSE SECTION 

(a) Functions. The driver license section conducts the testing of all persons who seek legal pennits 
to drive. The section conducts the Driver Improvement Conference and processes all driver records. 
.Medical evaluations of selected drivers are conducted when necessary'. The section also conducts 
hearings in conjunction with its authority to suspend, revoke, or cancel licenses. 

Note: The various statutory authorities for the suspension, revocation or cancellation of licenses 
are contained in .Article 2 of Chapter 20 of the General Statutes -- The Uniform Drivers License 
Act. In addition, the section has an internal review procedure [G.S. 20-16(d)|. It is important 
to note that for non-mandatory revocation, cancellations, or suspensions, there is the right of 
appeal to the courts (G.S. 20-25). 

(b) Identifying Information. Driver license examining offices are located throughout the state. The 
addresses for these offices are on fde in the driver hcense section main office at the Motor Vehicles 
Building in Raleigh. 

History Note: Statutory Authority G.S. 20-1; 20-3; 20-39; 

20-40; 20-50; 20-63(h); 20-86.1; 20-315; 20-316; 

Eff. July 1, 1978; 

Amended Eff. November 1, 1991. 

.0706 \ EHICLE REGISTRATION SECTION 

(a) Functions. The vehicle registration section is administered by a director responsible to the 
Commissioner of .Motor Vehicles, fhe section is responsible for the distribution and issuance of hcense 
plates, issuance of certificates of titles and certificates of registration, recording of liens against motor 
vehicles, enforcement of the Financial Responsibility Act of 1957 and the collection of registration fees, 
use or sales ta.x. In order to provide statewide service, contracting license plate agents are estabhshed 
for the issuance of license plates and acceptance of applications for certificates of title. In addition to 
the main Raleigh office located in the .Motor Vehicle Building two license plate branch offices are lo- 
cated in Charlotte. Insurance hearing officers hold hearings for individuals who have had their insur- 
ance terminated. 

(b) Identifying Information. Addresses for vehicle registration section offices outside Raleigh are on 
file in the vehicle registration section main office at the Motor Vehicles Building in Raleigh. 

History Note: Statutory Authority G.S. 20-1: 20-3; 20-39; 
20-40; 2b-63(h); 20-86.1; 20-315; 20-316; 
Eff. July 1, 1978; 
Amended Eff. November 1, 1991. 

.aiOl ENEORCE.MENT SECTION 

(a) Functions. The enforcement section is responsible for administering and enforcing the Motor 
Vehicle Safety Inspection Program; the Motor Vehicle Safety Equipment Exliaust Emission Program; 
the Motor Vehicle Dealers and Manufacturers Licensing .Act; the size and weight laws on trucks oper- 
ating on the streets and highways; the fuel tax laws of the North Carolina Department of Revenue; the 
laws pertaining to the public and private sale of motor vehicles to satisfy storage and or mechanic's liens 
and under judicial procedures; the laws and reciprocal agreements governing registration of motor ve- 
hicles; the Federal Motor Carrier Safety Regulations including HAZ.MAT placarding; and all motor 
vehicle laws (Chapter 20) pertaining to the operation of vehicles. Further, the enforcement section is 
responsible for examining salvage vehicles to prevent auto theft, use of stolen parts, salvage switches, 
and fraud; investigating stolen motor vehicles, fictitious driver licenses and fraudulent titles and main- 
taining a central file of all vehicles reported stolen or recovered in North Carolina; collecting returned 
checks given to the Division of Motor Vehicles; processing and maintaining records of aU vehicles 
stored by law enforcement personnel throughout the state; establishing standards and procedures for 

quipment approval by the Commissioner of .Motor Vehicles; auditing motor carrier company records 
for violations of Federal Motor Carrier Regulations; serving registration plate and driver license revo- 
:ation orders; and hcenstng truck dri\er training schools and their instructors. 

(b) Identifying Information. Addresses for enforcement section offices outside Raleigh are on file in 
he enforcement section maui office at the Motor Vehicles Building in Raleigh. 

History Note: Statutory Authority G.S. 15A-40I; 15-402; 

20-1; 20-3: 20-39; 20-40; 20-49; 20-77; 20-102; 



6:16 NORTH CAROLINA REGISTER November 15, I99I 1144 



FINAL RULES 



20-/04; 20-110: 20-111; 20-114; 20-118.1; 

20-183.2; 20-183.4; 20-183.5; 20-/83.9; 

20-285; 44A-4; 

Eff. July /, 1978; 

Amended Eff. Xovember /, /991; .April 22, 1981. 

.0708 INTERNATIONAL REGISTRATION PLAN (IRP) SECTION 

(a) Functions. The international registration plan (IRP] section is responsible for the administration 
of the International Registration Plan Agreement which covers the titling, licensing, and auditing re- 
cords of apportionable vehicles. The section is also responsible for the titling and licensing of trailers 
under the tive-ycar registration plan and vehicles allocated by non-resident rental companies and for 
monitonng the allocation of "U- Drive-It" passenger vehicles. 

(bj Identifying Information. Addresses for international registration plan (IRPj otTices outside 
Raleigh are on tile in the international registration plan (IRPj section mam office at the Motor Vehicles 
Building in Raleigh. 

Histon Sote: Statutorv Authority G.S. 20-39; 20-50; 
20-84.2: 20-87 to 20-93; 
Eff. July /. 1978; 
.4 mended Eff. Soxember 1. 1991. 

.0709 COLLISION REPORTS/GENERAL SERMCES SECTION 

The collision reports general services section is responsible for administration of the accident reporting 
laws and financial responsibility laws relating to traffic accidents. The section is also charged with the 
responsibility of furnishing statistical traffic data to the general public on a local, state and national 
scale. 

History Sote: Statutorv Authority G.S. 20-3; 20-43; 
20-177; 20-279.3; 20-279.4; 
Eff. July /, /978; 
.Amended Eff Soxember / , 1991 . 

.0710 SCHOOL BUS AND TRAEEIC SAEETV SECTION 

(a) Functions. The school bus and traffic safety section is responsible for administering programs to 
train and certify school bus dri\'ers, issuing restricted instruction permits, licensing the state's commer- 
cial driver training schools, conducting the division of motor vehicles' driver improvement clinics. This 
section also provides traffic safety educational programs and material to highway users. 

(b) Identifying Information. .Vddresses for school bus and tratTic satety section offices outside Raleigh 
are on file m the school bus and traffic saletv section main office at the .Motor Vehicles Building in 
Raleigh. 

Hisior; Sote: Statutory Authority G.S. 20-1: 20-3: 20-218: 20-321; 
Eff July 1. 1978; 
.Amended Eff. Soxember 1 . 1991 . 

.071 1 GO\ ERNOR'S HIGHWAY SAEETV PROGRAM 

The Governor s Highway Safety Program is responsible for administering. de\'eloping and coordinat- 
ing state and local activities and plans for the reduction of highway traffic crashes, fatalities and injuries. 
The Governor's Highway Safety Program operates under the supervision of a representati\e appointed 
by the Go\emor and ser\ing at his pleasure. This function includes administering funds under the 
Federal Highway Safety .Act. The section also coordinates management information and property 
control and administers field services. 

Histon; Sote: Statutor\- Authority G.S. 20-1: 143B-3i^0; 147-/2(10); 
Eff July /. /978; ' 
.Amended Eff. Soxember /, 1991 . 

SECTION .0900 - NORTH CAROLINA RAILROAD CO.MPANV 



1145 6:16 NORTH CAROLINA REGLSTER November 15, 1991 



FINAL RULES 



.0901 IDEMIFYING INFORMATION 

(a) The North Carolina Railroad Company is a private corporation, of which a majority of the capital 
stock is owned by the State of North Carolina. The Governor appoints 10 of the 15 members of the 
board of directors and five members are elected by the stockholders at a general meeting. 

(b) The North CaroHna Railroad Company may be contacted at the following address and telephone 
number: 

North Carolina Railroad Company 

P. O. Box 2248 

Raleigh, North Carolina 27602 

Telephone: (919) 829-7355 

FAX: (919) 829-7356 

History Note: Statutory Authority G.S. I43B-358; 
147-12(7): S.L. 1849, Ch. 82, s. I; 
■ ^ Eff. July I, 1978; 

Amended Eff. November 1 , 1991 . 

.0902 FUNCTIONS 

The North Carolina Railroad Company was incorporated to effect east-west railroad transportation 
from Morehead City through the center of the state. The east-west railroad line facilitates the 
conveyance of freight between Selma and Morehead City, and freight and passengers between Sclma 
and Charlotte. It connects with vanous interstate railroads along the line. The North Carolina Rail- 
road Company is a non-operating company with all properties leased, and aU operations arc conducted 
by the lessee. 

History Note: Statutory Authority G.S. 147-12(7); 
S.L. 1849. Ch. 82. s. I: 
Eff Jidv I. 1978; 
Amended Eff November I. 1991. 

CHAPTKR 2 DFV ISION OF HIGIfWAYS 

.SLBCIIAPTFR 2A - GENFRAL ADMFMSTRATION 

SEC HON .0100 - ST.VFE IlKiHVVAY ADMINISTRATOR 

.0102 DETIES OF ADMFSTSTRATOR 

The duties and responsibilities of the State Higliway Administrator and conferred by law and delegated 
or prescribed by the Secretar> or Board of Transportation include: 

(1) recommend ordinances based upon engineering studies of the Traffic Engineering Branch; 

(2) enter into agreements and contracts for the board; 

(3) carry out Board programs and functions; 

(4) has certain powers and duties concerning highway right of way acquisitions which may be sub- 
delegated to the right of way branch: 

(a) negotiate and execute documents on the acquisition and release of rights of way, borrow and 
local material deposits and waste disposal areas; 

(b) award and execute contracts as to buildings and improvements to be cleared from rights of way; 
Note: See contract procedure in G.S. 136-28.1. 

(c) execute United States Department of Transportation right of way certificates; 

(d) executed right of way encroachment and utility relocation agreements; and 

(e) approve right of way payments; 

(5) negotiate and execute contracts with right of way fee appraisers; 

(6) negotiate and enter into agreements under the Uniform Relocation Assistance and Real Property 
Acquisition Policies Act; 

(7) authorized to make spot safety improvement funds for primary, secondary', and urban safety 
projects available as needed and that said authority may be delegated to the Manager of Traffic 
Engineering by the State Highway Administrator; 

(8) execute lease or rental agreements on behalf of the State; 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1146 



FINAL RULES 



(9) annually inspect the State roadway system to determine the need, priorities, and scheduling for 
major maintenance, retreatment or resurfacing (subject to the Board's approval) in each engineer- 
ing di%ision; 

(10) determine the need for temporary traffic control devices for special events; 

(11) review and approve median opening requests: 

(12) review and appro\e ci\ic. non-profit, or charitable organization safety rest stop activities; 

(13) handle and execute bicycle trails joint use rights of way; 

(14) consider and issue or deny permits for intermittant closing of secondar,' roads within watershed 
improvement projects; 

(15) issue special overweight and over-dimension permits; 

(16) authorize crop cultivation uithin rights of way; 

(17) authorize garbage collection container sites on rights of way; 

(18) authorize construction uithm the nght of way; 

(19) permit construction of railroad tracks across any portion of the roadway system; 

(20) re\'iew, investigate and allow or deny contractor settlement claims for construction; 

(21) determine existence of emergency situation justifying the waiver of the bidding requirements as 
described in the general statutes; 

(22 1 promulgation, subject to discretionan,' re\iew by the Secretary of Transportation, of those rules, 
regulations, and ordinances pertaining to highway matters as delegated by the Secretan,' of Trans- 
portation; 

(23) shall submit a priority list and or consult with Board of Transportation members in each major 
maintenance, retreatment or resurfacing project as requested by the Board members; 

(24) hold bid withdrawal hearings; 

(25) the State Highway Administrator is authorized and delegated to duty to submit applications to 
the Federal Emergency Management Agency and to execute the assurances and agreements and 
other documents on behalf of the Department of Transportation necessary for Federal Disaster 
Assistance, including the Designation of Applicants Agents. Assurances and Agreements, Damage 
Sune_\' Reports and Requests for Payments. The Admimstrator is further authorized to subdele- 
gate the authority and duty for Federal Disaster Assistance on behalf of the Department of 
Transportation to the Manager of the Mamtenance and Equipment Branch. 

Histon Sole: Statutory Authority G.S. 136-19; 136-18(5); 136-44.1; 
136-30: I36-S9.5I; 136-''1.9; 136-64.1 (d); 136-93; 
I36-/S.3; /36-ISi// 1: 136-29; 136-28.1; 136-20-119; 
143-29.1; I43B-J0,jj; 143B-350{f); 143B-350(gj; 
133-5 thru 17; 
Eff. Julv I. 197S; 

Amended Eff. .Xovember I. 1991: October I. 1991: 
Januan- I. 1986: August I. 1982. 

SECTION .0200 - LEASE OR RENTAL OF PROPERTY 

.0202 FISCAL SECTION'S RESPONSIBILITY 

Hislon- Sote: Statutory Authority G.S. 146-25./ ; 146-2''; 146-32(2); 
l43B-350(f); l43B-350(g); 
Eff. Julv I, 1978; 
Repealed Eff. .Xovember I. 1991. 

SUBCHAPTER 2B - HIGm\ AY PLANNING 

SECTION .0100 - ri(;ht of way 

.0102 DELEGATION TO MANAGER AND ASSISTANT .MANAGER 

The State Highway .Administrator has delegated to the Manager of Right of ^^'ay Branch and Assistant 
Manager of Right of Way Branch the following powers and duties: 

(1) to negotiate and execute aU documents pertaining to the acquisition of rights of way, borrow and 
local material deposits and of waste disposal areas and releases of such interests in borrow and local 
material deposits and waste disposal areas when no longer producti\'e or useful for the purpose 



114' 6:16 AORTH CAROLLXA REGISTER November 15, 1991 



FINAL RULES 



acquired; to release interests in land acquired for right of way, but not used nor needed for right 
of \va> ; 

(2) to award and execute all contracts pertaining to the removal, relocation, alteration and sale of 
buildings and other improvements to be cleared from highway rights of way, borrow and waste 
disposal areas; such contracts shall be awarded to the lowest responsible bidder after competitive 
bidding; 

(3) to execute all certificates required in connection with the request to the U. S. Department of 
Transportation for reimbursement of right of way costs on federal-aid highway projects; 

(4) to execute all riglit of way encroachment agreements and contracts and utihty relocation and cost 
reimbursement agreements; 

(5) to approve the payment of all claims for right of way, provided however aU payments of claims 
in excess of five hundred thousand dollars ($500,000) may be approved only by the State Highway 
Administrator or the Secretary of the Department of Transportation; 

(6) to negotiate and execute contracts with fee appraisers required for right of way appraisal; 

(7) to negotiate, enter into agreements, and execute documents in accordance with the provisions of 
the Uniform Relocation Assistance and Real Property Acquisition Policies Act and the regulations 
adopted and promulgated by the Board of Transportation; 

Note: See Subchapter 2A, Rule .0102 for duties of the State Highway Administrator in relation to 
rights of way. 

Hislorv \ote: Statutory Authorilv G.S. 133-5: 133-17; 

136-18(2); 136-18(10); 136-19: l43D-350B(f).(g); 

Eff. Julv I, 1978; 

Amended Eff. November I, 1991: October I. 1991; June I. 1985. 

.0104 GENERAL PROCEDURE UNDER RIGHT OE WAY ACQUISITION 

(a) Each owner of property affected by right of acquisition wlU be contacted by: 

(1) personal contact by a representative of the Department of Transportation if the owner resides 
within the state; or, 

(2) mail and or telephone if the owner resides outside of the state. 

(b) The representative of the Department of Transportation will carefully point out in detail to the 
property owner how the particular project is going to affect his property. 

History Note: Statutory Authority G.S. 136-18(2); 136-19; l43B-350(f).(g}; 
Eff July I. 1978; 
Amended Eff. November f 199L 

.0107 APPRAISAL CONTRACTS 

(a) /Ml appniisal assignments, whether for appraisal, timber cruises, affidavits, specialty reports, cost 
estimates, or basic sales data, including all revisions and supplements, must be covered by the Depart- 
ment of Transportation Appraisal Contract. 

(b) The Department of Transportation uses a form called Appraisal Contract for agreements between 
independent real estate appraisers and the Board for the appraisal of the fair market value of land. This 
form requires description of the parcel to be appraised, the owner, type of appraisal, appraisal fee, and 
Dther conditions of the agreement. Copies of this form may be obtained from the \lanager of Right 
Df Way, Division of Highways, at no cost. 

Hislorv Note: Statutory Authority G.S. 136-18(2); 136-19; l43D-350(f).(g}; 
Eff July I. 1978; 
Amended Eff. November 1 , 1991. 

.0108 NUMBER OE APPRAISALS 

Two or more appraisals may be obtained in any case where the nature of the taking and the appraisal 
problems are complex. 

Historv Note: Statutory' Authority G.S. 136-18(2); 136-19; l43B-350(f).(g}; 
Eff July I, 1978; ' 
.Ametided Eff. November 1 , 1991 . 



6:16 NORTH CAROLINA REGISTER November 15, 1991 INS 



FINAL RULES 



.(H09 A( Ql ISniON OrHKR IHAN LMMPRON EI) STATE SECONDARY ROADS 

lliston note: Statutory Authority G.S. 136-18(2): 136-19; l43B-350(f).(g): 
Eff. July I. I97S; 
Repealed Eff. November /, 1991. 

.0111 NEGOTIATION BY CORRESPONDENCE 

llluor)- Sole: Statutory .iuthoritv G.S. 136-18(2): 136-19; l43B-350{f).(g): 
Eff. .lulv I. 1978; ' 
Repealed Eff November /, 1 90 1. 

.01 14 NEc.oriA HON w nil departmen r oe transportation employees 

The following is the Department of Transportation's policy for acquiring right of way from Depart- 
ment of Transportation employees performing highway functions: 

( 1 ) The appraisal of any property having damages in excess of two thousand fiNe hundred dollars 
($2,500), owned by an emplo\ee of the Department of Transportation, be made by an independent 
fee appraiser, rather than a staff appraiser; 

(2) The Right of Way Review Board pass on the approval of the appraisal of any employee of the 
right of way branch, or any other employee of the Department of Transportation performing 
highway functions at salan,' grade 73 or above; 

(3) Right of way acquisitions may be negotiated at the approved appraisal with employees below 
salary grade 73; 

(4) Right of way acquired from any employee of the Department of Transportation performing 
highway functions at salary grade 73 or above shall not be acquired by negotiation but by the filing 
of a complaint and declaration of taking. 

History- \ote: Statutory Authority G.S. 1 36-18(2 1: 136-19: l43B-350{f)fg); 
Eff July I. 1978; ' 
Amended Eff November /, I99L 

.0121 RICH T OE WAY DONATIONS 

Department of Transportation and Federal Tlighway Administration regulations will pemiit the Right 
of Way Branch to accept a donation of nglit of way without appraisals provided the owner is iiifonned 
of his legal riglits to receive just compensation. 

Uistorx' Note: Statutoiy Authority G.S. L^6-!8(2): 136-19: I43B-350(f),(g): 
Elf July I. 1978: 
Amended Eff November I. 199 L 

.0122 DISPOSITION OF IMPROX EMENTS PIRCHASED BY THE BOARD 

llLstor\' Note: Statuton- Authority G.S. L^6-I8(2); 136-19: l43B-350(f).(g); 
Eff. July /, 1978; 
Repealed Eff November /, I99L 

.0123 SECONDARY ROAD R1(,HT OF WAY 

1 he Department of Transportation, with the approval of the Board of Transportation, may acquire 
by condemnation sccond;ir\' road riglits of way. 

History Note: Statutory Authority G.S. I36-I8(2l: 136-18(26); 
L^6-29: '136-44.7; 
Eff July I. 19:^8: 
Amended Eff November I, 1991. 

.0129 NO OBLIGATION OTHER THAN LS AGREEMENT WILL BE RECOGNIZED 

It is imperati\e that the right of way instrument(s) of conveyance specihcaJly include all terms and 
conditions mutually agreed upon and that it retlect a complete agreement on all matters involved in the 
negotiation. No obligations other than those set forth m the instrument(s) will be recognized, and the 



1149 6:16 NORTH CAROLINA REGISTER November 15. 1 99 1 



FINAL RULES 



performance of the terms and conditions contained therein relieves the Department of Transportation 
of any and all further obligations or claims. 

History \ote: Statutory' Authority G.S. 136-IS(2); 136-19; l43B-350(f),(g); 
Eff. July I. 1978; 
Amended Eff. November 1 , 1991 . 

.0134 SETI LEMENT OF CLALMS AFFER INSTITUTION OF SLIT AND DEPOSIT 

The following procedure will be followed for the closing of claims after the institution of suit both 
where the property owner agrees to take the amount deposited in fuU compensation or where it is 
agreed that an additional sum will be paid to property owner. These procedures generally apply only 
to settlement prior to the tiling of answers by the property owner. Where an answer has been fded by 
the property owner, the transaction will be handled by the Department's trial attorney directly with the 
property owner's attorney. 

(1) Settlement of suit by withdrawal of deposit as full compensation: Upon notification from the 
property owner that he desires to withdraw the deposit in fuU settlement, the agent will fdl out 
form "Application for Disbursement of Deposit as FuU Compensation". The condemnee signs 
this form and the form permits the Department of Transportation to settle the suit by consent 
judgment. 

(2) Settlement of cases for an amount in excess of that deposited; In those cases where the Right 
of Way Agent receives authority from the .Manager or Assistant .Manager of Right of Way to settle 
a case for an amount in excess of that deposited, form "Agreement to Settle Right of Way 
Claim" shall be used, fhe condemnee signs this form and the form permits the Department of 
Transportation to settle the suit by consent judgment. 

Hislon- Note: Statutory Authority G.S. 136-18(2); 
136-19: 136-103; l43B-350(f}.(g); 
Eff July I. 1 978; 
Amended Eff November I, 1991. 

.0136 IMPRO\ EMENTS NOT TO BE \IO\ ED 

In its acquisition program the Department of Transportation will acquire numerous buildings, par- 
ticularly in urban areas, that are substandard and of such age and condition that they should not be sold 
for removal to nearby vacant property. In those instances where a mo\ing permit will not be granted 
by the municipality, the buildmg may still be offered for sale. 

History Note: Statuton Authority G.S. 136-/8(2 1; 136-19; l43B-350(f),(g); 
Eff July E 1978; 
Amended Eff. November 1 , 1991 . 

.0138 DISPOSITION OF IMPRO\ EMENTS 

rVll improvements that are acquired in connection with the right of way are to be disposed of by one 
of the following methods: 

(1) resold to the property owner for the retention value placed upon the improvement by the ap- 
praisal, 

(2) sold by public sale or by a negotiated sale if no bids are received after proper advertisement, 

(3) demolished by the roadway contractor or by demolition contract, 

(4) retained by the Department for other pubhc use, 

(5) sold to a displacee for replacement housing. 

Historx Note: Statutory Authority G.S. 136-18(2); 136-19: l43B-350(f),(gl; 
Eff July I. 1978; 
Amended Eff November /, I99L 

.0139 PUBLIC SALE OF IMPRO\ EMENTS 

(a) Improvements acquired by the Department of Transportation that are not resold to the property 
Dwner may be disposed of by a public sale. The preferred method of sale is by means of sealed bids, 

Iter proper advertisement. In unusual situations it may be desirable to sell improvements by means 
3f auction sale, but only after prior approval of the State Property Manager of the Right of Way Branch 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1150 



FINAL RULES 



in Raleigh. Sales of property must be ad\ertised in a newspaper of general circulation in the county 
in uhich the property is located. The advertisement should appe;ir in two consecutive issues of a daily 
or weekly paper. The date for opening bids should not be earlier than ten days after publication of the 
first advertisement. 

(b) If no bids are received for the sale of impro\ements after proper advertisement, it wiU be per- 
missible to negotiate the remosal of an impro\ement with indi\iduals interested m purchasing them. 

Uiston- Sote: Statuion Auihoritv G.S. 136-18(2): 136-19; 143B-350(f),(g); 
Eff.Jidv IJ97S; 
Amended Eff. Sovemher I. 1991. 

.0143 IHE SALK OF SLRFLl S LANDS 

(a) Department of Transportation policy relative to disposal of remainder properties acquired in 
connection with acquisition of right of way is as follows; 

(1) The sale of all residues will be by public sale except as hereinafter specified. 

(2) Residue properties sold by public sale are to be sold by either sealed bid, or by auction at the 
election of the nght of way branch. The sale of such properties must be advertised by publica- 
tion in a newspaper ha\ing general circulation in the county in which the property is situated. 
After opening bids or closing of auction, no upset bids will be considered. The high bid shaU 
be presented to the Department of Iransportation at its next regular meeting after the date of 
the sale for rejection or acceptance. The Department of Transportation reserves the right to 
reject all bids. 

(3j Those residue properties located adjacent to controlled access projects that are landlocked may 
be sold to the adjoining property owner by negotiation rather than public sale for a consider- 
ation not less than the appraised \'alue of the residue. 

(4) Residue properties may be sold to state agencies and institutions and other go\emmental units 
by negotiation rather than public sale for a consideration not less than the appraised value of the 
residue. 

(5) Surplus property acquired in connection with highway purposes may be used for the purpose 
of exchange with a pubhc utihty company m part or in fuU consideration for property to be 
acquired for highway purposes from the public utihty company. Such exchanges shall be based 
on the appraised values of the surplus property and the property to be acquired for highway 
purposes. Residue property acquired m connection \\ ith nght of way for a project may be used 
for the purpose of exchange in part or full consideration for right of way being acquired from 
another property owner on the project. Such exchanges to be based on the appraised values 
of the residue property and the right of way to be acquired. 

(6) Residues which have an area of one-half acre or less or a value of one thousand dollars ($1,000) 
or less and the highest and best use is for assemblage v\ith adjacent property may be sold without 
advertising by negotiations to an adjoining owner. The Property Management l.'nit together 
w ith an area appraiser will determine the \alue of the residue based on its after \alue as indicated 
in the original appraisal, sales of similar properties and sales of other residues, if any, in the area. 
.Vlter a \alue has been estabhshed, the State Property .Manager may negotiate with the adjoining 
owners concerning the disposal of each residue. The decision of the State Property Manager to 
accept and complete a sale is final. 

(7) 'The .Manager of Right of Way is delegated authorit\' to dispose of residues \\ ith appraised values 
of less than one hundred dollars ($100.00) by executing and dehxering on behalf of the Depart- 
ment of Transportation, a quit claim deed to the buyers of such residues, after the transactions 
are first approved b\ the Board of Transportation. Conveyances of residues with appraised 
values of less than one hundred dollars ($100.00) shall not require the appro\al of the Governor 
and Council of State. 

(8) Residue properties or portions of residue properties acquired in connection with right of wa\ for 
a project and located outside the right of w ay for that project may be sold by negotiation rather 
than by public sale to property owners and tenants who are displaced buy the project for relo- 
cation of the displacee. Such sales are to be based upon the appraised value of the residue 
properties. 

(b) Should the Department of Transportation purchase a property in fee for right of way and later 
determine that the property is not needed for highway purposes, the otTcr of the original owner or 
his/her heirs or assigns to purchase the surplus right of way wlU be given first consideration. 1 he 
purpose price for the property will be based upon the current market \'aluc of the property, as deter- 



1151 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



mined by the Department of Transportation. Should the former owner or his/her heirs or assigns not 
desire to purchase the property, then the Department will dispose of the property in accordance with 
the Department's policy for the sale of residue property. 

Hislorv Note: Statutory Authority G.S. 136-18(2); 136-19: J43B-350ifJ.(gJ; 
Eff. July I. 1978; 

Amended Eff. October I, 1991; Februaiy I. I9S8; 
November I, 1986; August 1, 1982. 

.0144 RKS.ALE OF RESIDUE TO ORIGI\.\L OW'NER 

AH sales of surplus lands, including but not limited to surplus rights of way, residues and uneconomic 
renanants, require the approval of the Board of Transportation, the Council of State and the Governor. 

History Note: Statutory Authority G.S. 136-18(2); 136-19; 143B-350(f),(g); 
Eff July 1. 1978; 
Amended Eff October I, 1991. 

.0145 COPIES OF FORMS 

The following list contains forms which are used in the application of this Section to obtain infor- 
mation or forms that the indi\idual must fill out to complete necessary action. Copies of these forms 
may be obtained from the .Manager of Right of Way, Division of Highways at no cost. 

(1) Proposal and Contract for Rodent Control. This form is a contract that is to be completed by 
the contractor if someone wishes to bid on a rodent control contract. It will contain the parcel 
number on the project, the address of the property, and the contractor will fill in the amount of 
money in order for him to complete the contract. The form is to be signed by the contractor. 

(2) .Management .\greement. This form is used by the Division of Highways to set up a contract 
with a management firm or individual for the renting of properties owned by the Department of 
Transportation. 7his form wUl contain the individual parcels, the agent invohed. the amount of 
commission to be charged, and other items pertaining to the management of the property. 

(3) Rental .Agreement. This form is an agreement that is between the individual renter and the De- 
partment of Transportation for the rental of property or buildings owned by the Department of 
Transportation. 'This form wiU contain the former owner's name, where the property is located, 
the amount of the rent, and other information pertaining to the rental of the property. 

(4) Bid F'orm for Sale and Removal of Buildings and Other Improvements From the Right of Wa\ . 
This form is used by the Department of Transportation where buildings are purchased or retained 
by a property owner in the clearing of buildings from the right of way. Ihis form will contain the 
description of the improvement to be sold, who it was formerly owned by, and the individual 
bidding or buying the property must sign it. 

(5) Proposal and Contract P~orms. These proposal and contract forms are used for work to be per- 
formed by others such as demolition, or housemoving. 

(6) Contract Bond. There are two separate forms used by the Department of Transportation for 
individuals to complete in supplying a performance and pa\ ment bond for any work that requires 
a contract bond. These forms wiU be completed by the individual and companies supplying the 
contract bonds. 

(7) Proposal and Contract for Grave Removal. This form is used to outline the specific requirements 
in the removal of graves from a highway project. 

(Sj Bid Torm. This form is to be used for the bidding on real property which the Department of 
'Transportation might sell. This could be used for residue properties or transfer of properties to 
another indi\idual in the settlement of a claim. 

(9) Removal of Graves Certificate. This form is used to allow the contractor who is remo\ ing graves 
on a highway project to complete the agreement for grave removal. 

Histon Note: Stalutorv Authority G.S. 136-18(2 1: 136-19; I43B-350(f),(g); 
Eff. July 1. 1978; 
Amended Eff .Xovember I, 1991. 

.0151 R.AILROAI) GRADE CROSSING SIGNS 

It is hereby ordained that whenever the Department of Transportation directs any railroad to protect 
ts grade crossings by the erection of electric signals or other safety devices, the railroad so directed shall 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1152 



FI^AL RULES 



proceed to erect such electric signals or other safety devices as required in the order. I 'pon the instal- 
lation and placing into operation of the signals or other safety devices as required in the order, any ex- 
isting signals or other safety devices shall be remo\-ed by the railroad unless otherwise directed by the 
Department of Transportation. 

llislon Sole: Statulon' Authority G.S. l36-ISi5j; 136-18(11); 136-20; 
Eff.Julyl. 1978; ' 
Amended Eff. Xovember 1 , 1991 . 

.0158 CHANGING GRADK OF ROAD WHKN GRADE OF RR TRACKS IS CHANGED 

That \vhene\er any railroad changes the grades of its tracks where said tracks cross or intersect any 
road, street or highway of the State Highuay System, the railroad shaU be responsible for adjusting, at 
its own expense, the grade of such road, street or highway as required to meet the change in grade of 
the railroad's tracks or facilities, said adjustment of the road, street or highwa\" being made in a manner 
appro\ed by an authorized representati\e of the Department of Transportation. A minimum of ten 
feet runoff is required for each inch of ditTerence in eIe\ation between track grade and road grade unless 
otherwise approved by the Department of Transportation. The Department of I ransportation may 
by cooperath'e agreement perform the asphalt run-off work on a 100 percent reimbursement basis. 

History \ote: Statuton' Authoritv G.S. I36-I8{5>: 136-18(11); 136-20; 
Eff.Julvl. 1 9-8: 
Amended Eff. .Xovember I. 1991. 

.0163 IMPLEMENTATION OF ROADW AV CORRIDOR OFFICIAL .MAPS 

(a) A roadway corridor official map, hereinafter referred to as "official map", is dcfmed as a map, 
drawing or written description of a plamied roadway alignment, with approdmations of future right 
of way boundaries, which is adopted by the Board of Transportation for nght of way protection pur- 
poses. 

(b) The Di\ision of Highways of the North Carohna Department of Transportation is responsible 
for the implementation of the procedures go\'emmg the adoption of official maps. 

(c) The Department of Transportation shall conduct en\iromnental studies or screenings prior to the 
adoption of an official corridor map as follows: 

( 1 ) If en\ironmental studies are in the process of being conducted on a project being considered for 
an official map. then the adoption of the map must await the determination of the recommended 
alternative. In such cases, the public hearing required for a proposed official map or amendment 
under G.S. 136— 14.5n(a)( 1 j may be combined with the design pubhc heanng. 

(2) If environmental studies have not been conducted or are not underway for a project for which 
an official map is to be prepared, a preliminary.' environmental screening of the proposed align- 
ment must be conducted to determine the en\iromnental feasibility of the project. 

(d) An official map illustrating the proposed project must be prepared prior to the initiation of the 
map adoption procedure. An official map must be of sufficient detail to clearh identify the proposed 
project in terms of functional design, location and preliminary right of way boundaries. The approxi- 
mate property boundaries wdl be identified on the map and the names of the affected property owners 
at the time of the recording must be pro\ ided. .-Vll maps must be prepared in accordance with North 
Carolina Department of Transportation standards and the project alignments tied into the North 
Carolina State Coordinate Grid System. 

(e) The Department of Transportation shaU conduct a pubhc hearing on the proposed map or an 
amendment to the existing adopted map prior to the adoption of an official corridor map or amend- 
ment as follows: 

(1) The Pubhc Hearing Officer of the Division of Highways, after the project has been selected and 
the otTicial map has been prepared, w ill arrange the date and location of the pubhc hearmg on 
the proposed map or amendment as required by G.S. 136--14.50(a)( 1 ). The date of the hearing 
must be determined in advance so as to allow sufficient time for the period of public notice 
which is required pursuimt to G.S. 136-44. 50(a)( 1 ). 

(2) In addition to the pubhc hearing notice requirements estabUshed h\ G.S. 136-44. 50(a)( 1). the 
notice should indicate that copies of the proposed official map are available for review in the 
office of the District Engineer in whose jurisdiction the area which is the subject of the map is 
located. 



115.^ 6:16 \ORTH CAROLL\A REGISTER Sovember 15, 1991 



FINAL RULES 



(3) Ihe Public Hearing Officer will conduct the public hearing in accordance with customar>' prac- 
tices and procedures which have been established by the Department for such hearings. Public 
comment at the hearing should be directed towards the designation of the subject project as an 
"official map" and any impacts created by such designation. Pithcr a transcript of the public 
hearing or a summar>- of the comments made at the hearing will be prepared, 
(f) The Board of Transportation, following a review of the pubhc hearing transcript or the summary 
of the comments made at the hearing, is empowered to adopt an official map at a Board of Transpor- 
tation meeting. 

g) In addition to the statutor>- requirements for the distribution and maintenance of official maps 
established by G.S. 136-44. 50(b)( 1), a copy of an official map adopted by the Board of Transportation 
will be maintained by the Director of Programs, Policy and Budget Branch of the Division of Highways 
and a copy will be provided to the building inspectors and planning officials in the jurisdictions affected 
by the map. 

(h) The procedures for the Department of Transportation's consideration of petitions for variances 
from requirements imposed by the adoption of an official corridor map are as foUows: 

(1) Any property owner affected by an official map adopted by the Board of Transportation may 
petition for a variance from the requirements imposed by the statute (G.S. 136-44.51). A re- 
quest for a variance should be directed to the Director of Programs, Pohcy and Budget Branch 
for consideration and processing. The property owner may either request that an administrative 
hearing be held in the county in which the affected property is located or may state the reasons 
for and supply any evidence supporting the variance request in wnting to the Director of Pro- 
grams, ['olicy and Budget Branch. In instances where a hearing is scheduled pursuant to a re- 
quest for a variance, the Director of Programs, Pohcy and Budget Branch wiU pro\ide written 
notice of the hearing to the ma\or of any affected cit\ or the chairman of the board of com- 
missioners of any affected county, in accordance with G.S. 136-44. 52(b). 

(2) I pon consideration of the facts and circumstances pertaining to the petition for a variance as 
determined from evidence provided by the property owner, the Director of Programs, Pohcy and 
Budget Branch ma\ grant a variance, recommend the subject property be considered for ad\ance 
acquisition, or dens' the request. A written record of the decision will be pro\ ided to the peti- 
tioning property owner within 30 days of the date of the hearing or the date of the receipt of the 
written request for the variance. 

(3) If the petitioning property owner recei\es an unfa\orable ruling from the Director of Programs, 
Pohcy and Budget Branch concerning the variance request, he or she may request a review of 
the case by the State Highway Administrator. The State High\\a\' Administrator will e\'aluate 
the case and pro\ide a final administrative decision in writing u ithin 30 da\ s of the date of the 
receipt of the review request. 

(i) ,-\ny property located within a designated roadway corridor may be considered for advance ac- 
:}uisition prior to the expiration of the three year time period established in G.S. 136-44.5 1(b), if the 
;ircumstances meet the criteria or a hardship acquisition, as defined in the existing advance acquisition 
?ohcies of the Division of Highways Right of Way Branch, hereby incorporated by reference. All re- 
quest for such ad\'ance acquisition should be in writing, include all supporting documentation, and be 
submitted to the Director of Programs, Policy and Budget Branch. 

llistoi-v Sole: Statuton^ Authority G.S. 136-33.53: 136-44.50: 136-44.51: 136-44.52; 
Eff. October I. 1991: 

.0164 USE OF RIGHT OF WAY CONSULTANTS 

(a) Introduction and purpose. The North Carolina Department of Transportation maintains a staff 
apable of performing the normal workload for most of the functions required for the acquisition of 
ights of way for our highway systems. However, it is recognized that situations arise and certain spe- 
:ific needs exist which can best be met by the use of qualified consultants outside the Dep;irtment. 
Ihese Rules and Regulations are established as a guide for the preparation, execution and adminis- 
ration of contracts for right of way acquisition services bv consultant firms that are o\er ten thousand 
lollars ($10,000.00). 

^ue to the diversity of contract types, some portions of these Rules and Regulations ma\ not be fully 
ipphcable to all situations. The Right of Way Branch .Manager sh;ill be responsible for dctemiining 
vhen deviations from portions of these Regulations arc justified. 

Ihese Rules and Regulations ha\e been developed in response to and in accordance with, the following 
iirecti\'es and requirements: 



6.76 NORTH CAROLINA REGISTER November 15. 1991 ILU 



FINAL RULES 



(1| General Statute 136-28. 1(f); 

(2) 23 CFR 172, the FHWA regulations governing procurement of professional services; 

(3) 2i CI'R 710-720, FHWA right of way regulations which contain some contracting require- 
ments; 

(4| Office of Management and Budget (0MB) Circular A-102, Section 36, "Procurement." (Re- 
vised version announced in Presidential memo dated March 12, 1987.); 

(5) NCDOT Title VI Compliance Program. 
All personnel involved with contracts for right of way acquisition services shall comply with G.S. 
133-32 and the Department of Transportation Personnel .Manual, Section VI, entitled "Employee Re- 
lations". 

(b) Definitions. The following definitions are for the purpose of clarifying and descnbing words and 
terms used herein: 

(1) Right of Way Special Projects Admimslrator - 1 he induidual who is assigned the responsibility 
of initiating, negotiating, and administering a contract for professional or specialized services. 

(2) Cost per Unit of Work - A method of compensations based on an agreed cost per unit of work 
including actual costs, overhead, payroll additives and operating m.argin. 

(3) Cost Plus F^ixed Fee - A price based on the actual allowable cost, Lncludmg o\erhead and pa\roU 
additives, incurred by the firm performing the work plus a pre-established fi.xed amount for op- 
erating margin. 

(4) Cost Proposal - A detailed submittal specifying the amount of work anticipated and compen- 
sation requested for the performance of the specific work or services as defined by the Depart- 
ment. 

(5) Firm - Any private agency, firm, organization, busmess or individual ofYering qualified right of 
way acquisition services. 

(6) Lump Sum - A fixed price, including cost, overhead, pa\roLl additives and operating margin for 
the performance of specific work or services. 

(7) PayroU Burden - Employer paid fringe benefits including emplo\ers portion of F.I.C.A., com- 
prehensive health insurance, group Ufe insurance, unemplo\ment contnbutions to the State, 
vacation, sick leave, hohdays, workman compensation and other such benefits. 

(8) Proposal - .An expression of interest by a firm for performing specific work or services for the 
Department. 

(9) Scope of Work - All services, actions and physical work required by the Department to achie\c 
the purpose and objectives defined in the contract. Such services may include the furnishing 
of all required labor, equipment, supphes and materials except as specifically stated. 

( 10) Contract Amendment - A formal amendment which modifies the terms of an existing contract. 

(11) fermination Clause - A contract clause which allows the Department to terminate, at its dis- 
cretion, the performance of work, in whole or in part, and to make final payment in accordance 
with the terms of the contract. 

(c) Application. These Rules and Regulations shall apply to all contracts for nght of wa\ acquisition 
services which cost more than ten thousand dollars ($10,1)00.00) and are obtained by the Department 
of Transportation pursuant to G.S. 136-28(f). 

(d) Right of Way consultant selection committee. The Committee shall consist of the Branch 
.Manager, Assistant Branch Managers, Unit Heads, and the Right of Way Special Projects .Adminis- 
trator and shall be chaired by the Branch Manager. WTien Federal funds wiU be used as compensation 
for services to be solicited, a representative of the Federal Highway .Administration shall sit with the 
Committee but shidl not be a \oting member. 

(e) Pre-qualitication of firms - general agreement. On a yearly basis, the Department shall ad\ertise 
for firms interested in performing right of way acquisition services for the North Carolina Department 
of Transportation. The advertisement vviU be pubhshed in the North Carolina Purchase Directorv' 
and or the legal section of major newspapers. The response time will normally be two weeks alter the 
ad\ertising date. The response shall include the Federal Government's Forms 254 and 255, copies of 
the firms latest brochures, and such similar inJbrmation. Additional firms may be considered for pre- 
quaJification during the yearly period if they so request. 

Evaluation of the fimis expressing interest will be based on the following considerations: 

( 1 ) Possesses a high ethical and professional standing; 

(2) Responsible personnel shall be recognized professionals in the field(s) of expertise required by 
the contract; 

(3) .Adequate expenence in the field(s) of expertise required by the contract; 

(4) .Adequacv in both number and quality of staff to pertbnn the required services: 



1155 6:16 NORTH CAROLINA REGISTER November 15, 1 99 1 



FINAL RULES 



(5) Ability to meet the time schedule established for the work; 

(6) Financial ability to undertake the proposed work; 

(7) Adequacy of the firms accounting system to identify costs chargeable to the project; 

(8) Past performance by the firm on previous contracts with the Department of Transportation; 

(9) Any other data pertinent to the contract under consideration; 

(10) When pertinent, the firm shall possess the quahty of equipment necessary to perform the re- 
quired services to the standards acceptable to the Selection Committee. 
All firms meeting the qualifications in Paragraphs (e)(1) through (e)(10) of this Rule shall be designated 
as pre-qualified to perform right of way acquisition services for the North Carolina Department of 
Transportation and a General Agreement shall be executed with each firm for a term covering the fol- 
lowing year after review and acceptance of fixed billable rates by the Fiscal Section. Additional firms 
pre-quahfying during the yearly period shaU execute a General Agreement for the remainder of the 
yearly period. 

(f) Fixed billable rates. Ihe annual General Agreement will not be executed until the fixed billable 
rates submitted as Appendix E to the General Agreement have been reviewed by the External Audit 
Branch of the Department's Fiscal Section. The review wiU verify the accuracy of the proposed fixed 
billable rates based upon an examination of the average wage rates by employee classifications, over- 
head rates, as weU as limitations on compensation and indirect salaries, wages and fringe benefits. 

In order to perform the examination of Appendix E rates, the firm will be required to submit an anal- 
ysis showing the computation of the average wage rate per classification with supporting documentation 
for the salary and wage rates used (i.e., payroll register, check stubs, etc.). The overhead rate shall be 
based upon the current completed year and audited by a State/Federal Agency. If unaudited, the firm 
must submit a detailed computation of overhead accompanied by a chart of accounts, financial state- 
ment, and statement of employment policy. 

(g) Register of pre-qualified firms. Ihe Right of Way Special Projects Administrator will be re- 
sponsible for maintaining a "Register of Pre-Qualified Firms" which have executed a General Agree- 
ment to perform right of way acquisition services for the North Carolina Department of Transportation 
- Right of Way Branch. 

(h) Request for approval to sohcit specific project proposals. 'Fhe Right of Way Consultant Selection 
Committee through the .Manager of Right of Way is responsible for determining when the need for 
right of way acquisition services exists. Upon determining that a need exists, the Committee shall re- 
quest approval from the Branch .Manager to solicit proposals for the work. Ihe request shall be in 
writing and shaU include the type of work and specific justification for the work being performed by a 
consultant firm such as: 

(1) non-a\ailability of manpower, 

(2) lack of expertise, or 

(3) other reasons. 

(i) Solicitations of specific project proposals. Specific Project Proposals will be sohcited from all 
Pre-Qualified Firms. Solicitations shall be by direct mailing of plans and Specific Project Proposal. 
The Right of Way Special Projects Administrator, upon the approval of the Manager of Right of Way, 
shaU be responsible for prepanng the requests for proposals. Ihe request shall contain plans and in- 
formation descnbing the location of the project, types and scope of work required, and the time 
schedule for accomphshing the work. 

The solicitation for a Specific Project Proposal shall required that all firms shall attend a Scoping 
Meeting on a specified date in order to qualify to submit a Specific Project Proposal for consideration. 
Any fum that does not wish to submit a Specific Project Proposal on a particular project shall advise, 
m writing, the Manager of Riglit of Way of their decision not to submit a Specific Project Proposal for 
that project. 

(j) Selection of firm for specific project contract. The Right of Way Consultant Selection Committee 
shall review all responses received to the request for proposals and shall select three firms from those 
indicating interest (except when there are fewer than three responses). When several projects arc under 
consideration at the same time, a firm shall be selected for each project and two alternates may be se- 
lected from the entire group, at the discretion of the Selection Committee. These firms shall be listed 
in descending order of preference based on the Selection Committee's review and analysis of all re- 
sponses. The Committee may elect to intenlew all or part of the firms responding to the request for 
proposal prior to estabUshing the order of preference. The Selection Committee's file shall be docu- 
mented as to the reasons for the selection of a firm. 

In the evaluation of the firms submitting Specific Project Propo.sals, the following factors shall be 
considered: 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1156 



FINAL RULES 



(1) I he mcinetan,' amount of the competitive proposal; 

(2) The firm personnel and their qualifications who are currently available to perform right of way 
acquisition services on the specific project; and 

(3) Ihc ability of the firm to complete the work on time according to the Department's schedule. 
Any firm selected to perform Right of Way Services for the North Carolina Department of Transpor- 
tation shall be required to establish an otTice in North Carolina; and may, at the discretion of the De- 
partment, be required to establish the office at the location of the project. This office shall be the 
location for maintaining all project records open for re\"iew by appropriate Department personnel. 
After the authorization to proceed to negotiations is given by the Branch Manager, the Riglit of Way 
Special Projects Administrator shall notify the firm chosen by the Selection Committee. 

(k) Negotiation of specific project contract. Prior to recei\ing a specific project proposal, the Right 
of Way Special Projects Administrator shall prepare an estimate of the cost of performing the work 
in-house. This estimate will be used in evaluating the acceptability of the selected firm's cost proposal. 
The format used for preparation of the in-house estimate will var)' depending on the type of work re- 
quired. Generally it will include an estimate of the manhours required, broken down by classifications, 
converted to a cost estimate by the application of the appropriate salaries. Payroll additives (provided 
by the Fiscal Section), overhead and an estimate of the necessar)' direct expenses should be included. 
This in-house estimate shall be documented, easy to review and permanently retained in the project 
files. 

If considered necessary by the Right of Way Special Projects Administrator a meeting with the selected 
firm may be scheduled to discuss the scope of the proposed work. Ihe discussions wiU \ary depending 
upon the firm's familiarity with the Department's methods, policies, standards, etc. For firms unfa- 
miliar with the Department's requirements, the discussions should include: 

{ 1 ) PoHcies used by the Department for the type and scope of work in\olved; 

(2) A copy of a contract in draft form; 

(3) .Methods of payment; 

(4) Procedures for invoicing; 

(5) Standard forms to be used; 

(6) Fiscal requirements; 

(7) Items and or services to be provided by the Department. 

A representative of the firm shall keep minutes of the meeting, have them typed and submit a copy of 
the Right of Way Special Projects Administrator. The minutes shall be re\iewed for completeness, 
accuracy and confirmation of mutual understanding of the scope of work. The minutes shall be ap- 
prtncd by signature of the Right of Way Special Projects Administrator and an appro\ed copy will be 
returned to the tirm. 

The firm's competitive cost proposal shall be supported by a breakdown of the manhours required to 
perform each of the services contained in the contract and the fixed bdlable rate for each of the classi- 
fications of personnel to be utilized. The fixed fee must be specifically broken out on the firm's specific 
project cost proposal. Ihe firm's cost proposal must also include a detailed breakdown of all non- 
salan' direct costs and any sub-contract or fee services. 

Upon receipt of the selected tlrm's cost proposal, a review will be made. The review shall include a 
comparison with the in-house estimate and is intended to determine both the reasonableness of the 
proposal and areas of substantial differences which may require further discussion and negotiation. 
Where further negotiations are required, they shall be the responsibilit\' of the Right of Way Special 
Projects Administrator. 

The final negotiations shall satisfactorily conclude all remaining points of difference and shall consider 
any comments submitted by External Audit Unit. The Right of Way Special Projects Administrator 
with the concurrence of the Manager of Right of Way shall approve the final fee. 
If acceptable contract cannot be negotiated, negotiations will be terminated, the firm will be notified in 
writing and the next listed firm shall be contacted to initiate negotiations for the work. 

(1) Board of Transportation approval and execution of contract. Upon completion of fuial negoti- 
ations, the firm shall execute a minimum of two contract originals. 

The contract shall then be submitted to the State Highway Administrator who may consult with the 
Ad\isor>' Budget Commission pursuant to G.S. 136-28. 1(f). The proposed contract will then be sub- 
mitted to the Board of Transportation for appro\al. 

L pon approval by the Board of Transportation the contract will be executed by the \lanager ot Right 
of Way and returned to the Right of Way Special Projects Administrator. 1 he Right of Way Special 
Projects Administrator will transmit one original contract to the contracting firm and shall retain one 
in the project file. A copy of the contract will be provided to the Manager of the Program and Pohcy 



1157 6:16 NORTH CAROLL\'A REGISTER November 15, 1 99 1 



FINAL RULES 



Branch, copy to be the Department's Fiscal Section and copy to the Federal Highway Administration 
when federal-aid funds are involved. 

(m) Sub-contracting. A contracting firm may sublet portions of the work proposed in the contract 
only upon approval of the Right of Way Special Projects Administrator. 

The responsibility for procuring a subcontractor and assuring the acceptable performance of the work 
lies with the prime contractor. Also, the prime contractor will be responsible for submitting the proper 
supporting data to the Contract Administrator for all work that is proposed to be sublet. 

(n) .Methods of compensation: 

(1) Lump Sum - This method of compensation is suitable for contracts where the amount and 
character of required work or services can be clearly defmed and understood by both the De- 
partment and the contracting firm. 

(2) Cost Plus Fixed Pee - Phis method of compensation is suitable for contracts where the general 
magnitude of work is known but the scope of work or period of performance cannot be defmed 
clearly and the Department needs more flexibihty in expediting the work without excessive 
amendments to the contract. 

(3) Cost Per Unit of Work - This method of compensation is suitable for contracts where the 
magnitude of work is uncertain but the character of work is known and a cost of the work per 
unit can be determined accurately. 

(4) Cost Plus a Percentage of Cost - This method of compensation shall not be used. 

(o) Administration of contract. The administration of the contract shall be the responsibiUty of the 
Right of Way Special Projects Administrator. This will include the review of invoices and recom- 
mendation for payment to the Fiscal Section. 

(p) Contract Amendments. F^ach contract should contain procedures for contract modifications and 
defme what changes are permitted by mutual agreement of the parties in\olved and the changes that 
can onl\ be made by means of a contract amendment. 

The Right of Way Special Projects Administrator with the concurrence of the Manager of Right of 
Way may authorize changes involving minor details of clarifications, changes in time schedules, and 
other changes of a minor nature which do not cause a significant change in the scope of work, or which 
causes a change in the amount of compensation must be accomplished by contract amendment. For 
contracts which use federal funds a compensation for services, the contract amendment must be ap- 
proved by the Federal I lighway Administration. No work is to be performed by the contracting tirm 
on additional or disputed items until the dispute is resolved and.'or a contract amendment is executed. 
Contract amendments shall be processed using the same procedures as described in Subparagraphs 
(b)(10) and (b)(H) of this Rule. 

(q) Monitoring of work. The responsibility for monitoring the work, the schedule and pcrtbrming 
reviews at intermediate stages of the work shall rest w ith the Right of Way Special Projects Adminis- 
trator. 

(r) Final payment. When it is determined that the work is complete, the final invoice shall be ap- 
proved by the Right of Way Special Projects Administrator and forwarded to the Fiscal Section with 
a recommendation for payment. When the contract is terminated by the Department, the final pay- 
ment shall be for that portion of work performed. 

(s) Termination of contracts. All contracts shall include a provision for the termination of the con- 
tract b\ the Department with prior notice to the contracting firm. 

(t) Quarterly report. A quarterly report on the use of outside firms wiU be submitted to the Right 
of Way Branch Manager. This report shall be prepared by the Right of Way Special Projects Ad- 
ministrator and will be in chart 'graphic or other appropriate format. Copies shall be provided to the 
State Highway Administrator and the Assistant State Highway .Administrator. 

History Sole: Stalulory Authority G.S. 1 36-28. 1 {f); 
Eff. November I, 1991. 

.0165 ASBFSTOS CONTR.ACTS WITH PRIA .ATK FIRMS 

(a) The North Carolma Department of "fransportation maintains a staff capable of performing the 
normal workload for most of the functions required for the acquisition of nghts of wa> for our highway 
systems. However, it is recognized that situations arise and certain specific needs exist which can best 
be met by the use of quahficd consultants outside the Department. 

These Rules and Regulations are estabhshed as a guide for the preparation, execution and adminis- 
tration of contracts for Asbestos Inspections, Asbestos RemoNals, and Structure Cleanngs by consult- 
ant firms that arc over ten thousand dollars ($10,000.00). 



6:16 NORTH CAROLINA REGISTER November 15, 1991 I15S 



FINAL RULES 



Due to the diversity of contract t\pes, some portions of these Rules and Regulations may not be fuOy 
applicable to all situations. The Right of Way Branch Manager shall be responsible for determining 
deviations from portions of these Regulations are justified. Any deviation from these Rules will require 
approval of PHWA if Federal Funds are involved in the project. 

These Rules and Regulations have been developed in response to and in accordance with the following 
directives and requirements: 

(1) General Statute 136-28. 1(f) and (General Statute 130A-444 thru General Statute 130A-451. 

(2) 23 CFR 710-720, FHW'A nght of way regulations which contain some contracting require- 
ments. 

(3) 49 CFR 18.36, USDOT contracting regulations. 

(4) NCDOT Title VI Comphance Program. 

All personnel insolved with contracts for Asbestos Inspections, Asbestos Removals and Structure 
Clearings shall comply with Ci.S. 133-31 and the Department of 1 ransportation Personnel Manual, 
Section VI, entitled "Employee Relations". 

(b) DEFINITIONS. The following defmitions are for the purpose of clarifying and describing words 
and terms used herein; 

(1) Contract Administrator - The indi\idual who is assigned the responsibihty of initiating, nego- 
tiating, and administering the contracts for Asbestos Inspections, Asbestos Removals and 
Structure Clearings. 

(2) Cost per l.'nit of Work - A method of compensation based on an agreed cost per unit of work 
including actual costs, overhead, payroll additi\es and operating margin. 

(3) Cost Plus Fixed Fee - A pnce on the actual allowable cost, including overhead and payroll 
additives, incurred by the firm performing the work plus a pre-established fixed amount for op- 
erating margin. 

(4) Cost Proposal - A detailed submittal specifying the amount of work anticipated and compen- 
sation requested for the pertbrmance of the specific work or services as defined by the Depart- 
ment. 

(5) Firm - rVny pri\ate agency, firm, organization, business or individual offering qualified Asbestos 
Inspections, Asbestos Removals and Structure Clearings. 

(6) I ump Sum - A fixed price, including cost, overhead, payroll additi\es and operating margin for 
the perfomiance of specific work or ser\ices. 

(7) Payroll Burden - Employer paid fringe benefits including employers portion of F.I.C.A., com- 
prehensive health msurance, group life insurance, unemployment contributions to the State, 
\'acation, sick leave, hohdays, workers compensation and other such benefits. 

(8) Proposal - An expression of interest by a finn for performing specific work or services for the 
Department. 

(9) Scope of Work - /Vll services, actions and physical work required by the Department to achieve 
the purpose and objecti\es defined in the contract. Such services may include the furnishing 
of all required labor, equipment, supplies and materials except as specifically stated. 

( 10) Contract .Vmendment - A fomial amendment which modifies the terms of an existing contract. 

(11) Termination Clause - A contract clause which allows the Department to terminate, at its dis- 
cretion, the performance of work, in whole or in part, and to make final payment in accordance 
with the terms of the contract. 

(c) .\PPI ICA'FION. These Rules and Regulations shall apply to all Retainer contracts for Asbestos 
Inspections, Asbestos Removals, and Structure Clearings obtained b\ the Right of Way Branch of the 
Depailment of transportation under the authority of G.S. 136-28. 1(f) and in accordance with the 
provisions of G.S. 130A-444 through 130A-451. 

(d) SELECTION CO.MMIT'IEE. The Committee shaU consist of the Right of Way Branch Man- 
ager or his designated Representative, the State Relocation Agent and Property .Manager or his desig- 
nated Representative, and at least one employee of the Department's Preconstruction l.'nit and or 
Construction L mt Profession^ Staff designated by the Riglit of Way Branch .Manager, and shall be 
chaired by the Right of Way Branch Manager or his Representative. 

(e) SELECTION OF" FIR.MS. On a yearly basis (or as needed), the Department shall advertise for 
firms interested in performing Asbestos Inspections, Asbestos Removals, and Structure Cleiirings for 
the North Carolina Department of 1 ransportation. The advertisement will be published in the North 
Carolma Purchase Director)". The response time will normally be two weeks after the ad\ertising date. 
The response shall include copies of the numbered certifications of employees certified by NC Depart- 
ment of Fn\'ironment, Health, and Natural Resources - Occupational Health Section Asbestos Pro- 



1159 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



gram to perform Asbestos Inspections, copies of the firms latest brochures, and such similar 

information related to the firms qualifications. 

Evaluation of the firms expressing interest will be based on the following considerations: 

(1) Possesses a high ethical and professional standing (10%); 

(2) Responsible personnel shall be recognized professionals in the field(s) of expertise required by 
the contract and shaU possess all required State and Federal Certifications (20%); 

(3) Adequate in both number and quality of staff to perform the required services (10%); 

(4) Adequacy in both number and quahty of staff to perform the required services (10%); 

(5) Ability to meet the time schedule estabUshed for the work ( 10%); 

(6) I'inancial ability to undertake the proposed work (lO'o); 

(7) Adequacy of the firms accounting system to identify costs chargeable to the project (10%); 

(8) Performance by the firm on previous contracts with the Department of Transportation (10%); 

(9) Any other data pertinent to the contract under consideration (5°/o); 

(10) When pertinent, the firm shall possess the quality of equipment necessary to perform the re- 
quired services to the standards acceptable to the Selection Committee (5%). 
The Selection Committee shall, on the basis of the criteria of Subparagraphs (e)(1) through (e)(10) of 
this Rule, select eidit firms and two alternates for contract neaotiations. 

(f) REQUEST FOR PROPOSALS. Each Selected Eirm^and /Mtemate will be requested by the 
Contract Administrator to submit a Proposal which provides for: 

(1) a per unit cost for Asbestos Inspections which may be required by the Department during the 
year's term of the contract: 

(2) a per square foot cost and a per running foot cost for removing any asbestos material located 
in the inspections process; and 

(3) a unit price for general clearing of an improvement from 2,000 - 5,000 square feet; a unit price 
for general cleanng of an improvement from 2,000 - 5,000 square feet; a unit price for general 
clearing of an improvement over 5,000 square feet. 

The Proposal Request shaU state that the Department intends to enter into a Retainer Contract for the 
term of one year and up to a maximum amount of two hundred and fifty thousand dollars 
($250,000.00) each with eight firms on a Statewide basis to perform Asbestos Inspections, Asbestos 
Removal, and Structure Clearing! on an as needed basis. 

(g) NEGOl I.ATION OP C()NTRAC IS. Upon receipt of the Proposals from the right Selected 
Eirms and two Alternates negotiations shall be initiated with the eight Selected Firms to produce a 
Retainer Contract with a term on one year and maximum amount of up to two hundred and fifty 
thousand doUars ($250,000.00). Should negotiations fails to reach successful execution of a contract 
with any Selected Firm, they will be terminated and negotiations wiU be initiated with an Alternate 
Firm. 

The object of the negotiations shall be to establish an acceptable per unit cost for any .Asbestos Inves- 
tigations needed by the Department for the term of the contract and to establish an acceptable per 
square foot cost and per running foot cost for abatement of any asbestos discovered upon completion 
of the inspections and a unit cost for clearing of improvements. 

When agreement is reached on the unit costs, a Retainer Contract shall be executed with the eight Se- 
lected Firms for the term of one vear which provides for the scope of services enumerated in this Rule. 

(h) BOARD OF TRANSPORTATION APPROVAL AND E.XECUTION OF CONTRACT. 
Upon completion of fmal negotiations, the firm shall execute a minimum of two contract originals. 
The contract shall then be submitted to the State Highway Administrator who may consuh with the 
Advisor)' Budget Commission pursuant to G.S. 136-28. 1(f). The proposed contract wiU then be sub- 
mitted to the Board of Transportation for approval. 

Upon approval b\ the Board of Transportation the contract will be executed by the .Manager of Riglit 
of Way and returned to the Contract Administrator. The Contract Administrator wiU transmit one 
original contract to the contracting firm and shall retain one original in the Central Office. A copy of 
the contract will be provided to the Department's Fiscal Section. 

(i) REQUEST FOR SPECIFIC JOB ESTIMATES. \Mien the Department acquu-es Structures that 
require inspection for asbestos, two firms who have executed the Retainer Contract will be contracted 
by the Riglit of Way Branch, given the location of the Structure(s), and requested to submit an Work 
Assignment Cost Estimate. The first Firm's estimate shall cover Inspections, both preliminary and 
fmal; and the second Firm's Estimate shall be for Abatements, if any, and Clearing, if required, of the 
stmcture. The Estimate of Job Costs submitted by the contractor will be re\iewed by Riglit of Way 
Staff Personnel to insure: 

(1) that the per unit cost is in comphance with those specified in the Retainer Contract; and 



6:16 NORTH CAROLINA REGISTER November 15, I99I 1 1 60 



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(2) the quantities specified in the Estimate of Job Costs are reasonable. 
If the estimate is found to be reasonable, the Contract Administrator shall authorize the work by the 
F-irm under the Retainer Contract b\ signing the Estimate document. If the estimate is unacceptable 
and agreement c;innot be reached by negotiations with the Firm, an Estimate will be requested from 
another Firm on Retainer Contract and evaluated in the same manner until agreement is reached and 
work can be authorized. 

(j) SUB-CONTRACTING. A Contracting Firm may sublet portions of the work proposed in the 
contract only upon approval of the Contract Administrator. 

'Fhe responsibility for procuring a subcontractor and assuring the acceptable performance of the work 
lies with the prime contractor. .Also, the prime contractor will be responsible for submitting the proper 
supporting data to the Contract Administrator for all work that is proposed to be sublet. 

(k) METHODS OF CO.MPENSATION. Cost Per Unit of Work - This method of compensation 
is suitable for contracts where the magnitude of work is uncertain but the character of work is known 
and a cost of the work per unit can be determined accurateh. 

(1) AD.MINISrRA'riON OF CONTRACT. The admJmstration of the contract shall be the re- 
sponsibility of the Contract Administrator. This will include the re\ iew of in\'oices and recommenda- 
tion for pa\ment to the Fiscal Section. 

(m) CON'I R.ACT AMENDMENTS. Each contract should contain procedures for contract mod- 
ifications and define what changes are permitted by mutual agreement of the parties involved and the 
changes that can only be made by means of a contract amendment. 

The Contract Administrator with the concurrence of the Manager of Right of Way may authorize 
changes involving minor details or clarifications, changes in time schedules, and other changes of a 
minor nature which do not cause a significant change in the scope of work, or a change in the amount 
of compensation. The Department reserves the nght with the concurrence of the Manager of Right 
of Way to delete an\" clearmg item. 
No work is to be performed by the contracting firm on additional or disputed items until the dispute 
is resolved and or a contract amendment is executed. Contract amendments shall be processed using 
the same procedures as described in Subparagraphs (e)(7) and (e)(S) of this Rule. 

(n) .MONITORING OF WORK. The responsibility for monitoring the work, the schedule and 
performing reviews at intermediate stages of the work shaU rest with the staff personnel. .-Vn inspector 
may be assigned on each job by the Division Engineer who sh.all make periodic status reports to the 
Division Right of Wa\ Office. 

The firm wdl be required to pro\ide a written progress report accompanying each in\'oice describing 
the work performed for the project co\ered by the in\oice. 

(o) FIN-\L P.\"\"MFNT. WTicn it is determined that the work is complete, the linal m\'oice shall 
be approved by the Contract Adinimstrator and forwarded to the Fiscal Section with a recommenda- 
tion for payment. WTien the contract is terminated by the Department, the final pa_\"ment shall be for 
that portion of work performed. 

Should the firm believe that additional compensations and or time should be allowed for services not 
covered under the contract, the firm must notify the Department in writing within 30 days after receipt 
of fmal payment. The Department will render a decision on the claim which will be final, subject to 
re\iew in accordance with Chapter 150B of the North Carolina General Statutes. Exhaustion of the 
administrative procedure described herein shall be a prerequisite to the firm's right of review. 

(p) TER.MINATION OF CONTRACTS. All contracts shall include a provision for the termmation 
of the contract by the Department w ith proper notice to the contracting firm. 

(q) QUARTERED' REPORT. A quarterl\ report on the use of outside firms will be submitted to 
the Right of Way Branch .Manager. This report shall be prepared by the Contract Administrator and 
wiU be in chart graphic or other appropriate format. Copies shall be pro\ided to the State Highway 
Administrator and the Assistant State Highway .Administrator. 

Hisloty Sole: Slatuton Aut/writv G.S. I30A-444; I30A-451; 136-28. 1(f); 
Eff. Xovember I. 1991. 

SECTION .0200 - TRAFFIC ENGINEFRFSG 

.0201 DELEGATION BY STATE HIGHW AY ADMINISTRATOR 

The State Highway .Administrator delegates to the Manager of Traffic Engineering the authority to 
authorize spot safety improvement funds for primary, secondary' and urban safety impro\ements up to 



1161 6:16 NORTH C.AROLL\A REGISTER November 15, 1 99 1 



FINAL RULES 



seventy-five thousand dollars ($75,000); that any improvements over seventy-five thousand dollars 
($75,000) will continue to be approved or denied by the State Highway Administrator. 

History Note: Statutory Authority G.S. J36-/S(5); 136-30; 136-44. 1; 136-54; 136-89.53; 
Eff. January I. 1986; 
Amended Eff. October I. 1991. 

.0202 DEFINITIONS 

The foUovving terms shall have the ascribed meaning throughout this Section: 

(1) Traffic Control Device. A trafilc control device is any sign, signal, marking, channelization, is- 
lands or installation placed or erected under pubhc authority, for the purpose of rcgulatmg, warn- 
ing, or guiding traffic. 

(2) State Highway System. Those streets and highways as descnbed in the General Statutes of North 
Carolina, Chapter 136, Articles 3 and 3A. 

(3) .Municipafity. An incorporated city or town. 

(4) State Municipal System Street or Highway. Any street or highway on the State Highway System 
within a municipality. 

(5) Non-State System .Municipal Street or Highway (.Municipd System). Those streets and high- 
ways accepted by the municipality which are not a part of the State Highway System. The 
municipafity shall be responsible for the maintenance, construction, and reconstruction of this 
system. 

(6) State Rural System Highway or Street. Any liigliway or street on the State Highway System 
outside the Limits of a municipafity. 

(7) Board. North Carolina Board of Transportation. 

(8) Manual on Uniform Traffic Control Devices. Manual on Uniform Traffic Control Devices for 
Streets and Highways, pubfishcd by the U. S. Department of Transportation, Federal Highway 
Administration, and approved by the Board of Transportation. 

(9) Titles. The titles Manager of Traffic Engineering and State Traffic Engineer used in this Section 
are synonymous. 

(10) North Carolin Supplement to the .Manual on Uniform Tniffic Control Devices. Supplement 
to the .Manual on Unifonn Trafiic Control Devices pubfished by the North Carolina Department 
of Transportation, and approved by the Board of Transportation. 

niston> Note: Statutory Authority G.S. 136-IS; 136-20: 136-45: 136-66.1; 
Eff. July I, I97S; 
Amended Eff. November 1 . 1991 . 

.0203 RESPONSIBILITY FOR TRAFFIC CON I ROL DEMCES 

(a) Installation and Maintenance -- General. The Department of Transportation is responsible for 
the installation and maintenance of all trafiic control devices on all highways and streets on the State 
Highway System necessan,' for regulating, warning, or guiding traffic. Such devices must be in sub- 
stantial conformance with the Manual on Uniform Traffic Control Devices, or any subsequent re- 
visions of the same, and any Department of Transportation approved supplements to, or interpretations 
thereof. The initial installation of traffic control devices shall be the result of an engineering evaluation 
conducted under the direction of the Manager of the Traffic Fnginccring Branch, Di\ision of Highways, 
Department of Transportation. 

(b) A municipality may install, erect, or alter, traffic control devices on State Highway System streets 
at its own expense, provided the devices are in substantial conformance with the "Manual on Uniform 
Traffic Control Devices", and the "North Carolina Supplement to the Manual on Uniform Traffic 
Control Devices", and such devices have approval of the Department of Transportation prior to their 
installation or alteration; 

( 1 ) The cost of mstalling or erecting new traffic control devices and the cost of altering existing traffic 
control devices to conform to the "Manual on Uniform Traffic Control Devices", and the 
"North Carolina Supplement to the Manual on Uniform Traffic Control De\ices", shall be paid 
for by the Department of Transportation unless otherwise agreed to by written agreement be- 
tween the municipality and the Board of Transportation. 

(2) The municipality will pay for the adjustment of all utifities necessary for the installation, erection, 
or alteration of traffic control devices unless otherwise provided for by written agreement be- 
tween the municipafity and the Department of Transportation. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1162 



FINAL RULES 



(c) The Department of I ransportation may upon written agreement (Municipal Maintenance 
Agreement for Traffic Control Devices) assign the responsibility for all or part of the maintenance of 
traffic control devices to a municipality. Such maintenance peribrmed by the municipality must be to 
standards acceptable to the Department of Transportation and in conformance to the "Manual on 
Uniform Traffic Control Devices", and the North Ciirolina Supplement to the Manual on Uniform 
Traffic Control Devices. The municipality will be reimbursed by the Department of Transportation 
for maintenance work performed under the terms of the agreement. A written agreement for mainte- 
nance work to be peribrmed b\" a municipahty shall remain in full force and effect for such period of 
time as the Department of Transportation and the municipality deem necessar>' and may be terminated 
by either party upon 30 days written notice. 

Histon Xote: Statutorr Authority G.S. 20-/5S: 20-/5S./; 20-169; 
136-18: '/ 36-30: 
Eff. July I, I97S: 
Amended Eff. Xovember J, 1991. 

.0208 UMFORM TR.\FFIC CONTROL DEVICES 

(a) The United States Department of Transportation publishes a volume entitled "Manual on Uni- 
form Traffic Control De\ices". Ihis publication has been adopted by the Federal Highway Adminis- 
trator as a national standard that is apphcablc to all classes of highways. This volume contains 
standards for the design and deployment of traffic control devices. The 1988 edition including any 
subsequent revisions or editions of the same is herebv adopted and incorporated by reference pursuant 
to G.S. 1 SOB- 14 (a) and (c). 

(b) Copies are available for inspection in the office of the State Traffic Engineer, Traffic Engineering 
Branch, R;deigh, N. C. Copies of the manual may be obtained from Superintendent of Documents, 
U.S. Go\emment Printing Office, Washington, D.C. 20402, for an estabUshed fee. 

lliston Sote: Statuton Authority G.S. 20-J5S: 20-/69: I36-IS(5): 136-30: 
Eff. July I. 1978: 
Amended Eff October I. 1991: January I. 1986: April 3. 1981. 

.0235 CI STODLAN AND LOCATION OF TRAFFIC ORDCSANCES 

Iliston- .\ote: Statutory Authority G.S. 136-/8(5 ): /50A-63(c): 
Eff July /, 1978: 
Repealed Eff Sovember /, /99/. 

SECTION .0300 - PLANAESG AND RESEARCH 

.0306 ESLABLISIIING ELKilHILITV - POWELL BILL 

/Vrmually as of July 1, each participating municipality shall establish its ehgibihty for an allocation. 
Towns incorporated prior to January 1, 1945, must submit a certified statement which provides infor- 
mation on the municipality's most recent election for the purpose of electing municipal officials, ad 
N'alorcm taxes, or other provisions for funding the general operating expenses of the municipality; and 
the mileage of its legally qualified, municipahty maintained streets. In addition, towns incorporated 
on or after January 1, 1945, must ;dso include in their certified statement infonnation on their: 

(1) ad \'alorem taxes; 

(2) budget ordinance; and 

(3) services provided. 

In all cases, the statement must be certified by the mayor and city clerk with the mileage certified by a 
registered professional engineer or a registered land suneyor. To support the mileage claimed on the 
certilied statement, a street map, certified by a registered land sur\'eyor or registered professional engi- 
neer, which clearly shows the claimed local city streets is required. If there have been no changes in 
mileage from the previous year, only certifications by the mayor and city clerk is required, forms and 
instructions are available from the Manager of Planning and EnNironmental Branch, North Carolina 
Division of Highwass, Raleigh. 2761 1. 

Histon Xote: Statutory Authority G.S. /36-4/./: /36-4/.2: /43B-350ifj,{gi: 
Eff July /, /978; 



1163 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



Amended Eff. November 1 , 1991 . 

.0313 PROGRAMMrSG - PL FINDS 

The expenditure of PL Funds by each organization shaO be supported by a planning work program 
setting forth the transportation planning work to be undertaken. Approval of the program by the 
Department of Transportation and the United States Department of Transportation is required. 

Histon' Sole: Statutory Authority 23 U.S.C. I04(fj: 23 L.S.C. 
134: G.S. I36-18U2); l43B-250(fi,(g): 
Eff. July I, I9''S; 
Amended Eff. November J, 1991. 

SECTION .0400 - RELOCATION ASSISTANCE PROCEDURES 

Note: The Department publishes a "Relocation Assistance Brochure" which contains the 
infonnation normally needed by a person being relocated. The brochure is available free 
from any Division of Highways Right of Way Relocation GlTice. 

.0401 DEFFMTIONS 

.0402 PIRPOSE 

.0403 EI ICIBILITY FOR STATE AND FEDERAL FUNDS 

.0404 APPLICABILITY 

.0405 ASSURANCES OF ADEQUATE RELOCATION ASSISTANCE PROGRAM 

.0406 PERSONS TO WHOM AD\ ISORV ASSISTANCE SHOULD BE OFFERED 

.0407 ASSISTANCE ON ADVANCE AND SPECIFIC PARCEL ACQUISITIONS 

.0408 PI BLIC NOTICE OF AVAILABILITY OF SERMCE 

.0409 rSTTIAL CONTACT WTTH DISPLACEE 

.0410 NOTICE TO FESANCIAL rsSTITUTIONS 

.0411 NINETY DAYS WRITTEN NOTICE 

.0412 REVIEW PROCEDURES 

.0413 SEVERED IMPROVEMENTS 

.0414 REQUESr FOR PROPERTY INSPECTION 

.0415 AGENCY RESPONSIBILITY 

.0416 MO\ TsG COST 

.0417 Gl IDELINES FOR HOUSEHOLD MON ES 

.0418 MOVrSG PAYMENTS TO BUSES ESSES 

.0419 AD\ ERTISING SIGNS 

.0420 REPLACEMENT HOUSEsG PAYMENTS 

.0421 REPLACEMENT HOUSESG PAYMENTS FOR O^AER OCCUPANT 

.0422 PAYMENT TO 0\\^ER-OCCl PANTS FOR ISO DAYS OR MORE \MIO RENTS 

.0423 REPLACEMENT HOUSIN(; PAYMEN I lO OW NER (SHOR F lERM OW NER) 

.0424 PAYMENT TO ONN^SER-OCCUPANTS FOR 90 DAYS \\TIO RENTS 

.0425 PAYMENT TO TENANT-OCCUPANT FOR 90 OR MORE DAYS N\TIO RENTS 

.0426 PAYMENT TO TENANT-OCCUPANT 90 OR MORE DAYS WTIO PURCHASES 

.0427 PAYMENT TO TENANT OF A SLEEPESG ROOM 90 OR MORE DAYS 

.0428 MOBILE HOMES 

.0429 SUBSEQUENT OCCUPANTS 

.0430 HOUSLSG AS A LAST RESORT 

.0431 COPIES OF FORMS 

Histoiy Note: Statutory' Authority G.S. 133-6; 133-7; 133-8: 133-9; 
133-10; '133-10.1; '133-11; 133-14; 133-146; 
136-18(2): 136-19; I43B-350 (a), if); 
Eff. April 3, 1981: 
Repealed Eff. Sovemher I, 1991. 

.0432 RESERVED FOR lUTl RE CODIFICATION 
.0433 RESERVED FOR FUTURE CODIFICATION 
.0434 RESER\ ED FOR FLTl RE CODIFICATION 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1164 



FINAL RULES 



(1435 ri:si:rm:i) for flu re codification 

.0436 RKSFR\ FI) FOR Fill RF CODIFICA HON 

.0437 RFSFRN FI) FOR FLU RF ( ODIFICA HON 

.((438 RFSFR\ FI) FOR Fl IFRE CODIFICATION 

.0439 Ri:SFR\ FI) FOR FL ILRE CODIFICATION 

.0440 RFSFR\ FI) FOR FLTLRF CODIFIC.VI ION 

.0441 DFFINFIIONS 

(a) The term business means any lawful activity except a farm operation that is conducted: 

(1) primarily for the purchase, sale, lease, and or rental of personal and or real property, and or for 
the manufacture, processing, and or marketing of products, commodities and/or any other per- 
sonal property; or 

(2) primanly for the sale of services to the public; or 

(3) primarily for outdoor advertising display purposes, when the display must be moved as a result 
of the project; or 

(4) by a non-profit organization that has established its non-profit status under applicable federal 
or state law. 

(b) The term comparable replacement dwelling means a dwelling which is: 

(1) decent, safe, and sanitar\ as further described; 

(2) functionally equivalent to the displacement dwelling; 

(3) adequate in si^.e to accommodate the occupants; 

(4) in an area not subject to unreasonable adverse environmental conditions; 

(5) in a location generally not less desirable than the location of the displaced person's dweUing with 
respect to public utilities and commercial and public facilities, and reasonably accessible to the 
person's place of employment; 

(6) on a site that is typical in size for residential development with normal site improvements, in- 
cluding customary landscaping. The site need not include special improvements such as out- 
buildings, sw imming pools, or greenhouses; 

(7) currently asailable to the displaced person on the pri\ate market. IIowe\er, a comparable re- 
placement dwelling for a person receiving government housing assistance before displacement 
may reflect similar government housing assistance; 

(8) witliin the fmancial means of the displaced person: 

(A) a replacement dwelling purchased by a homeowner in occupanc\ for at least ISO days prior 
to the initiation of negotiations is considered to be within the homeowner's financial means if 
the homeowner is paid the full price as further descnbed, all increased mortgage interest costs 
as further described and all mcidental expenses as further described, plus any additional amount 
recjuired to be paid under last resort housing. 

(B) a replacement dweUing rented by a displaced person is considered to be within his or her fi 
nancial means if after receiving rental assistance under this part, the person's monthh rent and 
utility costs for the replacement dw eUing do not exceed the person's base monthly rental for the 
displacement dwelling. 

(C) for a displaced person who is not eligible to receive a replacement housing payment because 
of the person's failure to meet length-of-occupancy requirements, comparable replacement rental 
housing is considered to be within the person's fmancial means if the Department pays that 
porti(5n of the monthly housing costs of a replacement dwelling which exceeds 30 percent of 
such person's gross monthly household income. Such rental assistance must be paid undei 
Replacement Housing of Last Resort. 

(c) The term contributes materially means that during the two taxable years prior to the taxable year 
in which displacement occurs, or during such other periods as the Department determines to be more 
equitable, a business or farm operation: 

( 1 ) has an average annual gross receipts of at least five thousand dollars ($5,000); or 

(2) had an average annual net eammgs of at least one thous;md dollars ($1,000); or 

(3) contributed at least 33 1 3 percent of the owners or operators average annual gross income from 
all sources. 

(4) If the application of the cnteria in Paragraphs (a), (b), and (c) of this Rule creates inequit>" oi 
hardship in any given case, the Department ma\ appro\e the use of other criteria as detennincc 
appropriate. 

(d) The term decent, safe and s;mitar\' dwelling means dwelling that meets applicable housing anc 
occupancy codes. However, if any of the following standards are not met by an applicable code sucl 



1165 6:16 NORTH CAROLINA REGISTER Novembey 15, 1991 



FINAL RULES 



following standards shall apply, unless waived. Such \vai\er must be obtained from the Raleigh Central 
Office. The dwelling shall: 

(1) Be structurally sound, weathertight, and in good repair. 

(2) Contain a safe electrical wiring system adequate for fighting and other electrical devices. 

(3) Contain a heating system capable of sustaining a healthful temperature of approximately 70 de- 
grees for a displaced person, except in those areas where local climate conditions do not require 
such a system. 

(4) Be adequate in size with respect to the number of rooms and area of living space needed to ac- 
commodate the displaced person. Ihere shall be a separate, well fighted and ventilated 
bathroom that provides privacy to the user and contains a sink, bathtub or shower stall, and a 
toUct all in good working order and properly connected to appropriate sources of water and to 
a sewage draining system. In the case of a house-keeping dwelfing there shall be a kitchen area 
that contains a fuUy usable sink, properly connected to potable hot and cold water and to a 
sewage drainage system, and adequate space and utifity service connections for a stove and 
refrigerator. 

(5) Contains unobstructed egress to safe open space at ground level. If the replacement dwelfing 
unit is on the second story' or above with access directly from or through a common corridor, 
the common corridor must have at least two means of egress. 

(6) For a handicapped displacee, be free of any barriers which would preclude reasonable ingress, 
egress or use of the dwelling by a displaced person who is handicapped. 

(e) The word "Department" means the North Carolina Department of Transportation. 

(f) The term displaced person means any person who moves from the real property or moves his or 
her personal property from the real property (This includes a person who occupies the real property 
prior to its acquisition, but who does not meet the length of occupancy requirements of the Uniform 
Act.): 

(1) as a direct result of a written notice of intent to acquire, the initiation of negotiations for, or the 
acquisition of such real property in whole or in part for a project; 

(2) as a direct result of rehabifitation or demofition for a project; or 

(3) as a direct result of a written notice of intent to acquire, or the acquisition, rehabilitation or 
demofition of in whole or in part, other real property on which the person conducts a business 
or farm operation, for a project. However, eligibility for such person appfics only for purposes 
of obtaining relocation assistance advisory service and moving expenses. 

(g) The fofiowing is a non-e.xclusi\e fisting of persons who do not qualify as a displaced person under 
these regulations: 

(1) a person who mo\'cs before the initiation of negotiations, unless the Department detennines that 
the person was displaced as a direct result of the program or project; 

(2) a person who initially enters into occupancy of the property after the date of its acquisition for 
the project; 

(3) a person who has occupied the property for the purpose of obtaining assistance under the 
Lnifonn Act; 

(4) a person who is not required to relocate permanently as a direct result of a project. Such de- 
termination shall be made by the Department in accordance with any guidelines estabfished by 
the Federal agency fundmg the project; 

(5) an owner-occupant who moves as a result of an acquisition that is not subject to the require- 
ments of the Uniform Act or as a result of the rehabilitation or demolition of the real property 
(lIowe\er, the displacement of a tenant as a direct result of any acquisition, rehabilitation or 
demofition for Federal or federaUy-assistcd project is subject to the Uniform Act); 

(6) a person who the Department determines is not displaced as a direct result of a partial acquisi- 
tion; 

(7) a person who, after recei\ing a notice of relocation cfigibifity, is notified in writing that he or 
she will not be displaced for a project. Such notice shall not be issued unless the person has 
not moved and the Department agrees to reimburse the person for any expenses incurred to 
satisfy any binding contractual relocation obligations entered into after the effective date of the 
notice of relocation eligibifity; 

(8) an owner-occup;int who voluntarily scUs lus or her property after being informed in w nting that 
if a mutually satisfactorv' agreement of sale cannot be reached, the Department will not acquire 
the property. In such cases, however, any resulting displacement of a tenant is subject to the 
regulations; 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1166 



FINAL RULES 



(9j a person who retains the right of use and occupancy of the real property for life following its 

acquisition by the Department; 
(10) a person who is determined to be in unlawful occupancy prior to the initiation of negotiations 
or a person who has been evicted for cause under applicable law. 
(h) The term dwelling means the place of permanent or customary and usual residence of a person, 
according to local custom or law, including a single family house; a single family unit in a two family, 
multi-family, or multi-purpose property; a unit of a condominium or cooperative housing project; a 
non-housekeeping unit: a mobile home; or any other residential unit. 

(i) The term farm operation means any activity conducted solely and primarily for the production 
of one or more agricultural products or commodities, including timber, for sale or home use and cus- 
tomarily producing such products or commodities in sufficient quantity to be capable of contributing 
materially to the operators support. 

(i) The term "lederal fmancial assistance" means a grant, loan, or contnbution provided by the 
United States, except any Federal guarantee or insurance and any interest reduction payment to an in- 
dividual in connection with the purchase and occupancy of a residence by that individual. 

(k) Unless a different action is specified in apphcable lederal program regulations, the term "initiation 
of negotiation' means the following: 

( 1 ) Whenever the displacement results from the acquisition of the real property by the Department, 
the "initiation of negotiations" means the delivery of the initial written offer of just compen- 
sation by the Department to the owner or the owner's representative to purchase the real 
property for the project. However, if the Department issues a notice of its intent to acquire the 
real property, and a person moves after that notice, but before deUvery to the initial written 
purchase olTer, the "mitiation of negotiations" means the actual mose of the person from the 
property. 

(2) WTienever the displacement is caused by rehabilitation, demolition or privately undertaken ac- 
quisition of the real propert\' (and there is no related acquisition by a Federal agency or a State 
agenc\ ), the "initiation of negotiations" means the notice to the person that he or she vviU be 
displaced bs the project or, if there is no notice, the actual mo\e of the person from the property. 

(3) In the case of a permanent relocation to protect the public health and welfare, under the Com- 
prehensi\e Fnvironmental Response Compensation and Liability Act of 1980 (Pub. L. 96-510, 
or "Superfund") the "initiation of negotiations" means the formal announcement of such relo- 
cation or the Federal of federally-coordinated health advisorx' where the Federal Government 
later decides to conduct a permanent relocation. 

(1) The term "lead agenc>" means the N.C. Department of Transportation. 

(m) The term "mortgage" means such classes of liens as are commonly given to secure advances on, 
or the unpaid purchase price of, real property, under the laws of the State, together with the credit in- 
struments, if any, secured thereby. 

(n) Ihe term "nonprofit organization" means an organization that is incorporated under the appli- 
cable laws of the State as a nonprofit organization and exempt from pa_\ing Federal income ta.xes under 
Section 501 of the Internal Re\enue Code. 

(o) Notice of Intent to Acquire or Notice of Fligibilitj for Relocation Assistance is a written notice 
furnished to a person to be displaced, including those to be displaced by rehabilitation or demolition 
acti\ities from property acquired prior to the commitment of Federal financial assistance to the activity, 
that establishes eligibihty for relocation benefits prior to the initiation of negotiation and or prior to the 
commitment of Federal financial assistance. 

(p) A person is considered to have met the requirement to own a dwelling if the person purchases 
or holds any of the following interests in real property: 

( 1) fee simple, a life estate, a land contract, a 99-year lease, or a lease including any options tor ex- 
tension with at least 50 years to run from the date of acquisition: or 

(2) an interest in a cooperative housing project which includes the right to occupy a dweULng; or 

(3) a contract to purchase any of the interests or estates described in this Rule; or 

(4) any other interest, including a partial interest, which, in the judgement of the Department war- 
rants consideratit)!! as ownership. 

(q) '1 he term person means any individual, family partnership, corporation, or association. 

(r) The phrase "program or project" means any activity or series of activities undertaken by a Federal 
agenc\' or with Federal financial assistance received or anticipated in any phase of an undertaking in 
accordance with the Federal funding agency guidelines. 

(s) The term "s;il\age value" means the proable sale price of an item, if offered for sale on the con- 
dition that it will be removed from the property at the buyer's expense, allowing a reasonable period 



7/67 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



of time to find a person buying with knowledge of the uses and purposes for which it is adaptable and 
capable of being used, including separate use of serviceable components and scrap when there is no 
reasonable prospect of sale except on that basis. 

(t) I'he term small business is a business having at least one, but not more than 500, employees 
working at the site being acquired or displaced by a program or project. 

(u) The term "tenant" means a person who has the temporary use and occupancy of real property 
owned by another. 

(v) The term "uneconomic remnant" means a parcel of real property in which the owner is left with 
an interest after the partial acquisition of the owner's property, and which the Department has deter- 
mined has little or no value or utility to the owner. 

(w) A person is considered to be in unlawful occupancy if the person has been ordered to move by 
a court of competent jurisdiction prior to the initiation of negotiations or is determined b\ the Agency 
to be a squatter who is occupying the real property without the permission of the owner and otherwise 
has no legal right to occupy the property under State law. The Department may, at its discretion, 
consider such a squatter to be in lawful occupancy. 

(x) Ihc term "utility costs" means expenses for heat, hghts, water and sewer. 

History Sole: Statutory Authority G.S. 133-7; 133-14; l43B-350tfj: 
Eff. \ovember I. 1991. 

.0442 PIRPOSE 

(a) \o ensure that owners of real property to be acquired for State and Federal assisted projects are 
treated fairly and consistently, to encourage and expedite acquisition by agreements with such owners, 
to minimise litigation and relieve congestion in the courts, and to promote public confidence in State 
and I'ederal assisted land acquisition programs. 

(b) To ensure that persons displaced as a result of State and Federal assisted projects are treated fairly, 
consistently, and equitably, so that such persons will not suffer disproportionate injuries as a result of 
projects designed for the benefit of the public as a whole. 

Historv Sole: Statutorv Authority G.S. 133-6; 133-9; 133-10; 133-14; 
l43B-35bif); 
Eff. November I. 1991. 

.0443 EI.IGIBIU rV FOR STA FK AND FEDERAL FINDS 

(a) State and federal funds may be used for relocation payments to eligible persons when all of the 
following conditions ha\e been met: 

(1) There has been approval of a state or federal-aid program or project and authorization to proceed 
has been issued. 

(2) WTien in fact a person has been or will be relocated by the right of way approval for such project. 

(3) WTien relocation costs are lawfully incurred. 

(4) When relocation costs are recognized and recorded as a liability of the state. 

(b) The type of interest acquired does not affect the eligibility of relocation costs for reimbursement 
provided the interest acquired is sufticient to cause displacement. 

(c) The state shall not withhold all or any part of any relocation payment to the displaccc to satisfy 
their obligation to the state. 

History Xote: Statutory Authority G.S. /33-9; 133-10; 133-14; l43B-350(f); 
Eff. Sovember I. 1991. 

.0444 APPEICABILITY 

The foUowing criteria sets forth those higliway projects for which relocation benefits are available: 

(1) all federal-aid highway projects involving nght of way on which individuals, families, businesses, 
farm operations and non-profit organizations have not been displaced prior to .March 5. 1977; 

(2) all state higliway projects involving nght of way, and on which it is anticipated federal funds will 
be required for any subsequent stage of the project, on which individuals, f;unilies, businesses, fann 
operations and non-profit originations have not been displaced prior to .March 5, 1977; 

(3) all state highway projects involving right of way on which individuals, families, businesses, farm 
operations, and non-profit organizations have not been displaced prior to .March 5, 1977, except 



6:16 NORTH CAROLINA REGISTER November 15, I99I 116S 



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that, these provisions shall not apply to those secondary roads projects consisting of paving or 
otherwise improving unpaved secondary roads. 

llistor): Sole: Statutoty Authoritv G.S. 133-9; 133-10: 133-14: l43B-350if): 
Eff. Xovembcr I. 1991. 

.0445 ASSURANCES OF ADKQL A IK RELOCATION ASSISTANCE PROGRAM 

The Department of Transportation has given to the Federal Highway Administration adequate as- 
surances that on federally assisted projects that: 

(1) Relocation pa_\mcnts and services were or will be pro\ided. 

(2) The public was or will be adequately mformcd of the relocation payments and services which will 
be available. 

(3) To the greatest extent practicable, no person lawfully occupying real property shall be required 
to move from their dwelling or to move their business or farm operation without at least 90 days 
written notice from the state of the date by which such move is required. 

(4) Assurances for individual projects will be included as follows: 

(a) Within a reasonable penod of time pnor to displacement, comparable replacement dwellings 
will be available or provided for displaced individual and families who are initial occupants; or 

(b) Adequate replacement dwellings will be available or provided for displaced individuals and 
families who are subsequent occupants; 

(c) The Department has a realistic relocation program which is adequate to provide orderly; timely 
and efficient relocation of displaced persons as provided. 

Hision- Sote: Staiuwn Authority G.S. 133-14: 136-18(2): 136-19: 
/43B-35d(a): 
Eff. \ovember 1. 199/. 

.0446 PERSONS lO WHOM ADVISORY ASSISTANCE SHOLLD BE OFFERED 

(a) Advisory services are a\ailable to displaced person on the project, as well as those persons occu- 
pying property immediately adjacent to property acquired for a highway project, provided the Manager 
of Riglit of Way detennines that such person is entitled to said services. 

(b) A displaced person can refuse relocation services and still be eligible for pa\'ments. There is no 
requirement that the displacee accept services if they desire to relocate on their own. It w ill be neces- 
sary, howc\er, that the decent, safe, and sanitary requirements be met and proper application within 
the time limits be made to qualify for payments. losses due to negligence of the relocated person, their 
agent, or employees, arc not eligible for reimbursement. 

(c) Ad\isory services shall be ofTered to any person (without regard to race, color, religion, sex or 
national origin) who, because of the acquisition of real propcrtx used for business or farm operations, 
moves from real property used for a dwelhng, or moves personal property from such other real prop- 
erty. The state relocation services program includes as a minimum such measures, facilities or practices 
as may be necessary or appropriate to: 

(1) discuss and explain the ser\'ices available, relocation payments and the eligibihty requirements 
therefor and assist in completing any application or other required forms; 

(2) ad\ise displaced persons that no payments received under The Iniform Relocation Assistance 
Act (P.L. 91-646) shall be considered as income for the purposes of the Internal Revenue Code 
of 1954 or for the purposes of determining the eligibility or the extent of eligibihty of any person 
for assistance under the Social Security Act or any other federal law . 

(d) The amount and extent of the advisory services shall be administered on a rea.sonable basis 
commensurate with the displaced person's needs. 

Histon- .Xote: Statutory Authority G.S. 133-1 1: 133-14: 133-15: 
136-18(2): 143B-350(f): 
Eff. \ovemher 1, 1991. 

.0447 ASSISTANCE ON AD\ ANCE AND SPECIFIC PARCEE ACQL ISITIONS 

Rek)cation assistance will be required on advance and specific parcel acquisitions in the same manner 
as it will be required on acquisitions for regular projects. L'niess the relocation will be on a project-wide 
basis, the public notice may be postponed. 



1169 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



History Sole: Staluton> Aulhoritv G.S. 133-14; 136-18(2); 143B-350{aj; 
Eff. November I, 1991. 

.0448 PI BI.IC NOTICE OF AVAILABILITY OF SERVICE 

(a) Public notice of the availability of relocation assistance will be given at each public hearing. The 
person holding the public heanng will advise those present of the availability of relocation assistance, 
as well as reimbursement of moving costs and supplemental payments for those eligible persons who 
will be displaced by the project. The Relocation Assistance Brochure v\ill be available for those at- 
tending the public hearings. 

(b) The relocation agent shall cause to be published in a newspaper(s) of general circulation in the 
area, a public notice to appear in one or more issues of the paper in the legal ad section ol the classified 
ads. A waiver of this advertisement may be granted by the State Relocation .Agent. 

History Sote: Statutor\' Authority G.S. 133-1 1: 133-14; l36-iS(2); 
l43B-35b(fl; 
Eff. November I, 1991. 

.0449 IM riAL CONTACT WTFH DISPLACEE 

(a) The relocation agent will secure the necessary information from the displacee, explain the relo- 
cation program and deliver to the displacee the Relocation Assistance Brochure. 

(b) It should be stressed to the owner of any tenant-occupied property that our contact is made with 
a tenant for securing information only and that no authon/.ation will be gi\cn at this time to the tenant 
to move. All information from the displacee shall be treated as privileged information. 

Histoty Note: Sialuloiy Authority G.S. 133-14; 136-18(2): l43B-3S0(f): 
Eff November I, 1991. 

.0450 NOTICE TO FINANCIAL INSTITUTIONS 

WTien a displacee otherwise qualifies for the replacement housing payments, except that the displacee 
has not yet purchased or occupied a suitable replacement dwelhng, the state, after inspecting the pro- 
posed dwelhng and finding that it meets the standards set forth for decent, safe, and sanitary dwellings, 
shall upon the request of the displacee, state to any interest party, financial institution or lending 
agency, that the displacee will be eligible for the payment of a specilic sum provided he purchases and 
occupies the inspected dwelling within the time limits specified. 

Histo>y Note: Statutory' Authority G.S. 133-14: I3S-IS(2): l43B-350(f); 
Eff November I, 1991. 

.0451 NrVETY DAYS WT^IITEN NOTICE 

No person lawfully occupying real property shall be required to move from a dwelling, fann, or 
business location without at least 90 days written notice of the intended vacation date. Exception to 
the policy will be directed to the State Relocation Agent and only in extreme cases will less than 90 days 
be approved. 

Histoty Note: Statuion' Authority G.S. 133-14: I38-I8{2): l43B-350(f); 
Eff November I. 1901. 

.0452 REVIEW PROC EDLRES 

(a) Should any person be dissatisfied with a determination as to their eligibility for a payment or of 
an amount of payment offered which they belie\e they should receive, they should request a re\iew by 
writing to the .Manager of Right of Way within 90 days after the date they are eligible to claim the 
payment. When it becomes known that a person is dissatisfied with a proposed payment, a Fonn 15.22 
wiU be provided for the purpose of a review. It is necessary for the displaced person to give sufficient 
reasoning and documents to support their request for a review. 

(b) Upon request for a rc\icw of any detennination to the Manager the State Relocation Agent shall 
transmit the determmation made to the Manager the basis for the detennination and all supporting 
documents, affidavhs or information considered. The Manager of Riglit of Way shall review the de- 
termination made by the relocation agent and shall consider any additional documents or data wliich 
the dislocated person cares to submit. The manager, upon request, will give the person or their agent 



6:16 NORTH C.iROLlN.i REGISTER November 15, 1991 1170 



FINAL RULES 



a full opportunity to present any arguments either oral or in writing, in support of their contentions 
The Manager of Right of Way shall, upon reviewing the determination and considering additional dat; 
which may be presented, either afhrm or modify in writing to the person the determination of the re 
location agent and set forth the basis for the action, including an explanation concerning any amoun 
claimed, if any, which has been disallowed. 

(c) Should the person be dissatisfied with the ruling of the Manager of Right of Way, they may withir 
30 days after recening the letter from the Manager of Right of Way request a review by writing to the 
State Highway Adrmmstrator. .-VJso, it is necessary for the displacee to give the Administrator reasonin; 
and documents to support this second review. 

(d) Upon request, the State Highway Administrator shall review the detemiination and the actior 
taken b\ the .Manager of Right of Way and, upon application of the person or the agent, will hear ar 
guments in support of the contentions of the displaced person. The State Highway Administrator, aftei 
re\iewing the matter and the contentions of the person, may modify the determination of the Manage 
of Right of Way or affirm it. The decision of the State Highway Administrator will be final and for- 
warded promptly in wnting to the displacee along with the reasons and explanations for the decision. 

History Sole: Statutory Authority G.S. 133-/4; 133-146; /43B-350(fJ; 
Fff. \ovember I, 1991. 

.(1453 SK\ ERKD IMPROVEMKMS 

Where only a portion of an improvement will fall within the right of way, the moving cost for th( 
removal of the personalty withm the nght of uay vs ill be compensated, as well as the cost necessary tc 
rearrange the personalty in the part of the impro\ement remaining outside of the right of way. Tht 
situation would occur most often where business or commercial properties are in\'olved. 

Ilistoiy Sole; Statutorv Authority G.S. 133-14; l43B-350(a); 
EJJ. November I. 1991. 

.0454 REQl EST I OR PROPERTY INSPECTION 

(a) It is necessary that all displaced persons expecting to receive the replacement housing or ren 
supplement payment must occupy a housing unit which meets the decent, safe, and sanitary housin; 
requirements. 

(b) It should be impressed upon the displaced person that they should not fail to request the in 
spection of the property they proposed to occupy; otherwise, they will forfeit their right to a supple 
mental pa\ment should it not meet the decent, safe, and sanitary requirements or cannot b( 
rehabilitated to meet the requirements. 

Ifistorv ,\ote; Statutory Authority G.S. 133-14; l43B-350(f); 
Eff. Sovember I, 1991. 

.0455 .AGENCY RESPONSIBIEH Y 

The agency u ill assume no responsibility or hability for structural, mechanical, legal, or other un 
foreseen problems that arc discovered ;ifter the inspection has been conducted. 

Uistorv Note; Statutory Authority G.S. 133-/4; /43B-350(f); 
Eff. November /, /9g/. 

.0456 MOVIN(, PAY.MENTS - RESIDEN II.AL 

(a) .Any displaced owner occupant or tenant of a dwelling who qualifies as a displaced person is en 
titled to reimbursement of his or her actual moving and related expenses as the Department determine 
to be reasonable and necessary. The displacee may move by a commercial mover based on the lowe 
of two estimates obtained by the Department or the displacee may self-move based on actural expense 
incurred up to the lower commercial estimate. The displacee must maintam adequate records tor re 
imbursement. 

Fligible expenses include: 

(1) transportation of displaced person and personal property. Transportation costs for a distan 
be\ond 50 miles are not eligible, unless the State detcmiines that relocation beyond 50 miles i 
justified; 

(2) packing, crating, and unpacking and uncrating of the personal property; 



1171 6:16 i\()RTH CAROLIIS.A REGISTER November 15, 1991 



FINAL RULES 



(3) disconnecting, dismantling, remo\ing, reassembling, and reinstalling relocated household appli- 
ances and other personal property; 

(4) storage of personal property not to exceed 12 months unless the Department determines that 
a longer period is necessary'; cost of storage on real property already owned or leased by the 
displaced person is ineUgible for reimbursement. 

(5) insurance for the replacement value of the property in connection with the mo\e and necessary 
storage; 

(6) the replacement value of property lost, stolen or damaged in the process of moving (not through 
the fault or the negUgence of the displaced person, his agent or employees) where insurance 
covering such loss, theft or damage is not reasonably as'ailable; 

(7) where the acquisition of real property used for an ehgible business or farm causes a person to 
vacate a dwelling or other real property not acquired or move his personal property from other 
real property not acquired, the additional expenses of moving such personalty are eligible for 
appropriate moving payments. 

(8) the Department will generally not participate in more than one move of a displaced person; 
however, where it is known to be in the public mtcrest, the State Relocation Agent may give 
prior approN'al to more than one move. 

(9) the Department may participate in a payment for relocating personal property of a displacee that 
is moved onto remaining or other lands owned by the displaced person or his landlord; 

(10) other moving related expenses that are not listed as ineligible as the Department determines to 
be reasonable and necessar>. 
(b) Any person displaced from a dwelling or seasonal residence is entitled to receive a fixed payment 
rather than a payment for actual mo\ing and related expenses except that a person occupying a fur- 
nished one-room unit shared by more than one other person, or a person whose residential mo\e is 
performed by the Department at no cost to the person, shall be hmited to fifty dollars ($50.00). 

LNFLRMSIIED UMTS 

1 Room - $ 250.00 

2 Rooms - 350.00 

3 Rooms - 450.00 

4 Rooms - 550.00 

5 Rooms - 625.00 

6 Rooms - 700.00 

7 Rooms - 775.00 

8 Rooms - 850.00 
Each Additional Room - $ 75.00 

FURNISHED UMTS 

1st Room - $ 200.00 

Each Additional Room - $ 25.00 

The preceding schedules exclude unfurnished or unused rooms, halls, baths, attics, porches, garages, 
dressing rooms, and utihty rooms. However, should a displacee have sufficient storage in carports, 
garages, enclosed porches, attics, sheds, or utiUt\ rooms, the Relocation Agent may count one addi- 
tional room for these areas. Discretion should be used when counting combination rooms- 
living; dining, kitchen 'dining, etc. If, in the opinion of the Relocation Agent enough personalty is in 
these combination rooms, then two rooms may be counted provided that there is a minimum of 200 
square feet. Otherwise, only one room may be counted provided that there is a minimum of 200 square 
feet. Otherwise, only one room may be counted. Basements having 200 square feet and not partitioned 
win count as one room if utilized as hving or storage area. For each additional 200 square feet, another 
room may be counted. 

Note: By using tlus Fixed Rate method, the displaced person may move by any means available and 
no further documentation is required. 

Histon' Xoic: Statuton' Authoritv G.S. /33.S: 133-14: l43B-350(f}: 
F.ff. Sovember I. 1991. 

.0457 MO\ TNG FAV.MENT - BUSINESSES, FARNLS, NON-PROFIT ORGANIZATIONS 

(a) Moving costs will be paid based on the lower of two estimates obtained by the Department. 
Should estimates or bids be difficult to obtain, an estimate not to exceed four thousand dollars ($4,000) 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1172 



FINAL RULES 



may be made by a Relocation Agent and approved by the Area Relocation Agent or the Raleigh OfTice. 
The estimate should be based on the estimated actual costs the displacee will incur and not on the 
amount a conmiercial moving firm would charge to make the mo\e. The use of commercial and other 
costs are not prohibited in making an estimate. The rates paid common labor in the area can be 
compared with the rates paid by moving companies in arriving at a fair and reasonable amount to be 
paid by the displacee to someone who will assist with their move. Also, rental rates for trucks or a 
reasonable allowance for vehicles owned or borrowed by the displacee and used in the move may be 
considered. Some additional time may need to be allowed due to the inexperience of the displacee in 
making the move. The amount of any moving expense estimate paid to the displacee must be sup- 
ported by evidence of actual expenses incurred. Also, the estimated commercial cost of the move 
should set the upper limit for the moving cost estimate. 

(b) Eligible cost in the business or farm operation which qualifies as a displaced person is entitled to 
payment for such actual moving and related expenses as the Department determines to be reasonable 
and necessary, including expenses for: 

(1) Transportation of personal property. Iransportation costs for a distance beyond 50 miles are 
not cUgible, unless the Department determines that the relocation beyond 50 miles is justified. 

(2) Packing, crating, unpacking, and uncrating of the personal property. 

(3) Disconnecting, dismounting, removing, reassembling, reinstalling relocating machinery, equip- 
ment and other personal property and substitute personal property. This includes connection 
to utilities available nearby. It also includes modification to the personal property to adapt it 
to the replacement structure, the replacement site or the utilities at the replacement site and 
modifications necessary to adapt the utilities at the replacement site to the personal property. 
(Expenses for providing utilities from the right of way to the building or improvement arc ex- 
cluded.) 

(4) Storage of personal property not to exceed 12 months, unless the Department detemiines that 
a longer period is necessar)'. Cost of storage on real property already owned or leased by the 
displaced person is ineligible for reimbursement. 

(5) insurance for the replacement value of the personal property in connection with the move and 
necessary storage. 

(6) Any Ucenses, permits, or certifications required of the displaced person at the replacement lo- 
cation, however, the payment will be based on the remaining useful life of the existing licenses, 
permits, or certifications. 

(7) The replacement value of property lost, stolen or damaged in the process of moving, (not 
througli the fault or the negligence of the displaced person or his or her agent or employees) 
where insurance coverage covering such loss, theft, or damage is not reasonably available. 

(8) Professional services necessarv for planning the move of the personnel property, moving the 
personal property, and installing the relocated personal property at the replacement location. 

(9) Reentering signs and replacing stationery' on hand at the time of the displacement that is made 
obsolete as a result of the move. 

(c) .Actual direct loss of tangible personal property incurred as a result of moving or discontinuing the 
business or farm operation. The payment shall consist of the lesser of 

(1) fair market value of the item for continued use at the displacement site less any proceeds of the 
sale. (To be ehgible for pavment the claimant must make a good fiith effort to sell the personal 
property, unless the Department determines that such effort is not necessary. When payment 
for property loss is claimed for goods held for sale, the fair market value shall be based on the 
costs of goods to the business not to the potential selling price); or 

(2) the estimated costs of moving the item but with no allowance for storage. (If the business or 
farm operation is discontinued, the estimated cost shall be based on a moving distance less than 
50 miles); 

(3) for advertising signs the amount of a payment shall be the lesser of 

(A) The depreciated reproduction cost of the sign as determined by the Department less the 
proceeds from its sale, 

(B) Estimated cost of moving the sign but with no allowance for storage. 

(d) The reasonable cost incurred in an attempt to sell an item that is not to be relocated. 

(e) WTiere only a portion of an improvement will fall within the right of way, the moving cost for the 
removal of the personalty within the right of way will be compensated, as well as the cost necessary to 
rearrange the personally in the part of the improvement remaining outside of the right of way. This 
situation would occur most often where business or commercial properties are involved. 



Il7i 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



(f) Purchase of substitute personal property. If an item of personal property which is used as part 
of the business or farm operation is not moved but is propedy replaced with a substitute item that 
performs a comparable function at the replacement site, the displaced person is entitled to payment of 
the lesser of: 

(1) the cost of substitute item including installation costs at the replacement site minus any proceeds 
from the sale or trade in of the replacement item; or 

(2) the estimated cost of moving and reinstalling the replaced item based on the lowest acceptable 
bid or estimate obtained by the Department for ehgible moving and related expense but with 
no allowance for storage. 

(2) Search for a replacement location. The displaced business or farm operation is entitled to re- 
imbursement for actual expenses not to exceed one thousand dollars ($1,000.00) as the Department 
determines to be reasonable which are incurred in searching for a replacement location including: 

(1) transportation; 

(2) meals and lodging away from home; 

(3) time spent searching based on reasonable salary or earnings; 

(4) fees paid to real estate agency or brokers to locate a replacement site excluding any fees or 
commissions related to the purchase of such site. 

(h) Other moving - related expenses that are not Listed as ineligible as the Department determines to 
be reasonable and necessary. 

(i) Should estimates or bids be difficult to obtain, an estimate not exceed four thousand dollars 
($4,000.00) may be made by a Relocation Agent and appro\ed by the /Vrea Relocation Agent or the 
Raleigh Office. 

(j) If the displacee elects a self-move, the moving cost payment will be authorized on the lower of two 
estimates obtained by the Department or an estimate not to exceed four thousand dollars ($4,000.00) 
prepared by a Relocation Agent and approved by the Area Agent. 

(k) Any displaced business is eligible for a fixed payment, in lieu of a pa\mcnt for actual reasonable 
and related expenses and actual reasonable re-establishment expenses. This payment, except for pay- 
ment to a non-profit organization, would be equal to its average annual net earnings, but not less than 
one thousand dollars ($1,000.00) nor more than twenty thousand doUars ($20,000.00) if the Department 
determines that: 

(1) The business caimot be relocated without a substantial loss of its existing partonagc (chentcle 
or net earnings). A business is assumed to meet this test unless the Department demonstrates 
that it will not suffer a substantial loss of its existing patronage; and 

(2) The business is not part of a commercial enterprise having more than three other entities, which 
are not being acquired by the Department, and, which are under the same ownership and en- 
gaged in the same or similar business acti\"ities, (for purposes of these procedures a remaining 
business facility that did not contribute materially to the income of the displaced person during 
the two taxable years prior to displacement shall not be considered "another estabUsliment."); 
and 

(3) The business contributed materially to the income of the displaced person during the two taxable 
\ears prior to displacement. Howe\er. the Department may wai\e this test for good cause. 

(4) The business owns or rents personal property which must be moved due to displacement and 
for which an expense would be incurred, and business vacates or relocates from its displacement 
site. 

(5) The business is not operated at a displacement dwelling or site solely for the purpose of renting 
such dwelling or site to others. 

(1) In determining whether two or more displaced legal entities constitute a single business which is 
entitled to only one fixed pa\ment, all pertinent factors shall be considered, including the extent to 
which: 

(1) The same premises and equipment are shared; 

(2) SubstantiaLl\" identical or mterrclated business functions are earned out and business and financial 
affairs are commingled; 

(3) The entities are held out to the pubhc, and to those customarily deaUng with them, as one 
busmess; 

(4) I he same person, or closeh related persons own, control, or manage the affairs of the entities, 
(m) Any displaced farm operation may choose a fixed payment in hcu of a payment for actual mo\ing 

and related expenses and actual reasonable moving and related expenses and actual reasonable re- 
establishment expenses, in an amount equal to its average annual net earnings, but not less than one 



6:16 NORTH CAROLINA REGISTER Novcmbey 15, 1991 1174 



FINAL RULES 



thousand dollars ($1,000.00) nor more than twenty thousand dollars ($20,000.00). In the case of a 
partial acquisition, the fixed payment shall be made only if the Department determines that: 

(1) The acquisition of part of the land caused the operator to be displaced from the farm operation 
on the remaining land: or 

(2) The partial acquisition caused a substantial change in the nature of the farm operation. 

(n) Any displaced nonprofit organization may choose a fixed payment of one thousand dollars 
($1,000.00) to twenty thousand dollars ($20,000.00) in heu of the pasments for actual moving and re- 
lated expenses and actual reasonable re-establishment expenses if the Department determines that: 

( 1 ) Cannot be relocated w ithout a substantial loss of existing patronage (membership or clientele). 
A nonprofit organization is assumed to meet this test, unless the Department demonstrates 
otherwise: and 

(2) .Any payment in excess of one thousand dollars ($1,000.00) must be supported with financial 
statements for the two 12-month periods prior to the acquisition. TTie amount to be used for 
the payment is the average of two years' annuaJ gross revenues less administrative expenses. 
Gross re\enues may include membership fees, class fees, cash donations, tithes, receipts from 
sales or other forms of fund collection that enables the non-profit organization to operate. 
.Administrative expenses are those for administrative support iuch as rent, utilities, salaries, ad- 
vertising and other like items as weU as fun raising expenses. Operating expenses for carrying 
out the purposes of the non-profit organization are not included in administrative expenses. 
The monetar\ receipts and expense amounts may be \erified with certified financial statements 
or financial documents required by public agencies. 

(o) The average annual net earnings of a business or farm operation are one haif of its net earnings 
bctore Federal, State and local income taxes during the two ta.xable years immediately poor to the 
taxable \'car in which it was displaced. If the business or farm was not in operation for the full two 
taxable years prior to displacement, net earnings shall be based on the actual period of operation at the 
displacement site prior to displacement projected to an annual rate. If these two taxable years are not 
representati\e for the business because the proposed construction has cause an outflow of residents and 
a reduction in net income, it is possible to use other consecutive tax years if prior approval is received 
from the Raleigh Oftice. Net earnings include any compensation obtained from the business or farm 
operation by its owner, the owner's spouse, and dependents. The displaced person shall furnish the 
Department proof of net earnings through income tax retums, certified financial statements or other 
reasonable evidence which the Department determine is satisfacton.'. 

(p) The determination for this payment will be made by the Area Relocation Agent from information 
furnished by the Project Relocation .\gent. .Adequate information should be compiled and submitted 
to reach a definite decision for each business, farm or nonprofit organization. Should there be any 
questions regardmg the qualification of any business, farm or nonprofit organization, the matter should 
be discussed with Raleigh Office. Tax retums should be submitted to Raleigh for \enfication prior to 
submission of the claim for payment. 

(q) In addition to payments available L nder Rule .0457 ((a) througli (j)] of this Section, a small 
business, fann, or nonprofit organization may be eligible to receise a payment, not to exceed ten 
thousand dollars ($10,0110.00) for expenses actually incurred in relocatmg and re-estabhshing such small 
business, farm, or nonprofit organization at a replacement site. 

( 1 ) Rc-estabUshment expenses must be reasonable and necessary, as determmed b\' the Department. 
1 hey may mclude. but are not limited to. the following: 
(.A) Repairs or improvements to the replacement real property as required by federal. State or 
local law. code or ordinance. 

(B) .Modifications to the replacement propert) to accommodate the business operation or make 
replacement structures suitable for conducting the busmess. 

(C) Construction and installation costs, not to exceed one thousand five hundred dollars 
($1,500.00) for exterior signing to advertise the business. 

(D) Pro\ision of utilities from right of way to improvements on the replacement site. 

(E) Redecoration or replacement of soiled or worn surfaces at the replacement site, such as paint, 
panelling, or carpeting. 

(F) Licenses, fees and permits when not paid as part of mo\ing expenses. 

(G) Feasibility suneys. soil testing and marketing studies. 

(H) .Ad\'ertisement of replacement location, not to exceed one thousand five hundred doUars 

($1,500.00). 
(I) Professional ser\"ices m connection with the purchase or lease of a replacement site. 



irS 6:16 yORTH CAROUSA REGISTER November 15, 1991 



FINAL RULES 



(J) Estimated increased costs of operation during the first two years at the replacement site, not 
to exceed five thousand dollars ($5,000.00) for such items as: 
(i) lease or rental charges; 
(ii) personal or real property taxes; 
(iii) insurance premiums; and 
(iv) utility charges excluding impact fees. 

(K) Impact fees or one-time assessments for anticipated heavy utility usage. 

(L) Other items that the Department considers essential to the re-establishment of the business. 

(iVl) Expenses in excess of the regulatory maximums set forth in Paragraphs (1), (C), (H) and (J) 
of this Section may be considered eligible if large and of operation at the displacement site and 
costs or operation at an otherwise similar replacement site. In such cases the regulatory limita- 
tion for reimbursement of such costs may, at the request of the State, be waived by the Federal 
agency funding the program or project, but in no event shall total cost payable under this Sec- 
tion exceed the ten thousand dollars ($10,000.00) maximum. 
(2) The following is a non-exclusive fisting of re-estabfishment expenditures not considered to be 
reasonable, necessary, or otherwise efigible: 

(A) Purchase of capital assets, such as, olTice furniture, filing cabinets, machinery, or trade fixtures. 

(B) Purchase of manufacturing materials, production suppfies, product inventory, or other items 
used in the normal course of the business operation. 

(C) Interior or exterior refurbishments at the replacement site which are for aesthetic purpK^ses, 
except as provided in Subparagraph (1)(E) of this Rule. 

(D) Interest on money borrowed to make the move or purchase the replacement property. 

(E) Payment to a part-time business in the home which does not contribute materially to the 
household income. 

(r) A displaced person is not entitled to payment for: 

(1) The cost of moving any structure or other real property improvement in which the diiplaced 
person reserved ownership; 

(2) Interest on a loan to cover moving expenses; or 

(3) Loss of goodwill; or 

(4) Loss of profits; or 

(5) Loss of trained employees; or 

(6) /Vny additional operating expenses of a business, farm, or nonprofit organization incurred be- 
cause of operating in a new location, except as provided in Paragraph (b) (3) and (1)(A) through 
(\I) of this Rule; or 

(7) Personal injury; or 

(8) Any legal fee or other cost for preparing a claim for a relocation payment or for representing 
the claimant before the Department; or 

(9) Expenses for searching for a replacement dwelling; or 

(10) Physical changes to the real property at the replacement location of a business, farm, or 
nonprofit organization, except as provided in Paragraph (b)(3) and (1)(A) through (.\1) of this 
Rule; or 

( U) Costs for storage of personal property on real property aheady owned or leased by the displaced 
person. 

History Note: Statutory Authorilv OS. 133-14; I43B-350{f); 
Eff. November I, 1991. 

.0458 ADVER I ISING SICiNS 

(a) The owner of a displaced advertising sign is eligible to receive a payment for actual reasonable 
moving and related expenses in moving their advertismg sign, in payment for actual direct losses of 
tangible personal property and in searching for a replacement sign site. 

(b) An advertising sign that is otherwise efigible for moving payments wiU not be efigible when it is 
moved to or from a site in violation of state, federal, or local regulations. 

(c) The provisions of this Rule do not apply separately to an advertising sign owned by and located 
on business or farm being displaced: 

(1) The owner of a displaced sign may be reimbursed for actual, reasonable moving expenses. 

(2) The owner of a sign may be reimbursed for actual direct losses when entitled to relocate the sign 
hut does not do so. The amount of such loss will be lesser of the depreciated reproduction cost 
of the sign as detennined by the Department of Transportation or the estimated cost of the sign. 



6:16 NORTH CAROLINA REGISTER Novcmbei 15. 1991 1176 



FINAL RULES 



(3) The owner of a displaced advertising sign may be reimbursed for actual reasonable expenses in 
searching for a replacement sign site not to exceed one thousand dollars ($1,000.00). Such ex- 
penses may include transportation expenses, meals, lodging away from home, and the reasonable 
value of time actually spent in search, mcluding the fees of real estate agents or brokers. All 
expenses claimed e.xcept value of time actually spent in search, must be supported by bills. 
Pa\ ment for time actually spent in search shall be based on the applicable hourly wage rate for 
the person conducting the search. A certified statement of the time spent in search and houriy 
wage rates shall accompany the pa\ment request. 

History Sole: Slatuton Authority G.S. 133-8: 133-14; l43B-350(f); 
Eff. \ovember I, 1991. 

.0459 REI'LACEMENT HOLSING PAVMKNTS 

(a) The replacement housing payment is the amount, if any, which when added to the amount for 
which the Department acquired the dwelling, equals the cost w hich the ow ner is required to pay for a 
decent, safe, and sanitarv dwelling or the amount determined by the Department as necessarv' to pur- 
chase a comparable dwellmg, whichever is less. 

(b) It is the Department's responsibility to make available as a comparable replacement dwelling unit 
and relocate the displaced person to his original ownership status if this is his or her desire. If the al- 
ternate tenancy is desired by the displacee, the Department will be expected to make a reasonable effort 
to accomplish the request. If the optional housing is a\ailable, the rent supplement, if any, will be 
based on the specific option. 

(c) When a single family dwelling is owned by several persons, and occupied by only some of the 
owners, the replacement housing payment will be the difference between the total acquisition costs of 
the acquired dweUing and the amount determined by the Department as necessajy to purchase a com- 
parable dwelling. 1 he Department is not required to provide persons owning only a fractional interest 
in the displacement dwelling a greater level of assistance to purchase a replacement dwelling than the 
Department would be required to pro\ ide such persons if they owned fee simple title to the displace- 
ment dwelling. If such assistance is not sufficient to buy a replacement dwelling, the Department may 
provide additional purchase assistance or rental assistance. 

(dj If the owner-occupant displacees do not purchase, the\ will be entitled to recei\e a rent supple- 
ment pa\ ment if they rent and occupy a decent, safe and sanitan.' dwelling in accordance with the rent 
supplement program. 

(e) An owner occupant owning only a partial interest must rein\ est his share of the acquisition costs 
plus the computed supplemental pa\ment m order to receive the ma.ximum payment. 

(f) The upper limit of a replacement housing payment shall be based on the cost of a representative 
comparable replacement dwelling. 

(1) If a\ailable, at least three representative comparable replacement dwellings shall be examined and 
the payment computed on the basis of the dwelling most ne^u-ly representative of and equal to 
or better than, the displacement dweUing. An adjustment shall be made to the asking price of 
an\- dwellmg to the extent justified by local market data. 

(2) If the site of the comparable replacement dwelling lacks a major exterior attnbute at the dis- 
placement dwelling site (e.g., the site is significantly smaller or does not contain a swimming 
pool), the value of such attribute shall be subtracted from the acquisition cost of the displace- 
ment dwelling for purposes of computing the payment. 

(3) If an uneconomic remnant remains after a partial taking and the owner of the remaining property 
agrees to sell the remainder to the Department, the fair market value of the remainder will be 
added to the acquisition cost of the displacement dwelling for purposes of computing the pay- 
ment. 

(4) If the acquisition of a portion of a typical residential property causes the displacement ot the 
owner from the dwellmg, and the remainder is a buildable lot as stated in the appro\'ed appraisal, 
the Department will offer to purchase the entire property and the fair market \'alue of the re- 
mainder w ill be added to the acquisition cost for purposes of computing the replacement hous- 
ing pa\ment. 

(5) To the extent t'easible, comparable replacement dwellings sh:dl be selected from the neighbor- 
hood in which the displacement dwelling was located or, if that is not possible, in nearb\ or 
similar neighborhoods where housing costs are generally the same or higher. 

(6) If other housing is available in a rural area (that is comparable, except that is not decent, sate 
and sanitarv), the supplcmentap," payment may be determined by estimating the cost to correct 



7/77 6:16 NORTH CAROLINA REGLSTER November 15, 1991 



FINAL RULES 



the decent, safe and sanitary deficiencies, adding this amount to the selling price of the replace- 
ment housing which is not decent, safe and sanitary and comparing this amount with the 
amount paid the displacee for his dwelling together with an area of land typical in size for a 
homesite in the general area. The owner of the non-decent, safe and sanitary' house must agree 
to correct the deficiencies and quote the sales price with the deficiencies corrected. 
(7) If replacement housing is available, the payment may be determined by estimating the amount 
paid for the dwelling at the present location, together with an area of land typical in size for a 
homesite in the general area and deducting this amount from the amount of a private contrac- 
tor's firm bid of the replacement cost of a functionally similar decent, safe and sanitary dwelling 
- on a comparable homesite. 
(g) If the displacement dwelling was part of a property that contained another dwelling unit and/or 
space used for non-residential purposes, and/or is located on a lot larger than typical for residential 
purposes, only that portion of the acquisition payment which is actually attributable to the displace- 
ment dwelling shall be considered its acquisition costs when computing the price deferential. 
(h) Market rent should be used when determining a Rental Replacement Housing Payment; 

(1) For an owner-occupant, use the fair market rent for the displacement dwelling. 

(2) For a tenant who paid little or no rent for the displacement dweUing, use the fair market rent, 
unless its use would result in a hardship because of the person's income or circumstances. 

(i) If the acquired dwelling is located on a tract t> pical in size for residential use in the area, the 
maximum replacement housing payment is the probable selling price of a comparable replacement 
dwelling on a tract typical in size for the area less the acquisition price ("before" value) of the acquired 
JweUing and the portion of the tract on which it is located. If the Department has offered to buy the 
entire property as a buildable lot, then the total \alue of the tract may be added to the acquisition cost 
of the displacement dwelling for purposes of computing the replacement housing payment. 

(j) If the acquired dwelling is located on a tract larger in size th;m typical for residential use in the area, 
the maximum replacement housing payment is the probable selHng price of a comparable replacement 
dwelling and the tract typical in size for residential use in the area, less the acquisition price of the ac- 
quired dwelling, plus the acquisition price of that portion of the acquired land which represents a tract 
typical in size for residenti;d use in the area. 

(k) Where the acquired dwelling is located on a tract where the fair market value is established on a 
use higher and better than residential, the ma.ximum amount payable is the probable selling price of a 
comparable replacement dwelhng on a tract t\pical in size for residential use in the area, less the ac- 
quisition price of the acquired dwelling, and the acquisition price of that portion of the acquired land 
which represents a tract typical for residential use in the area. If the dwelling is written otTor given no 
\alue for residential purposes in the approved appraisal, the ma.ximum replacement housing payment 
is the probable selling price of a comparable replacement dwelling on a tract typical in sb.e for resi- 
dential use in the area, less the entire acquisition price of the parcel. 

(1) if two or more occupants of the displacement dwelling move to separate replacement dwellings, 
each occupant is entitled to a reasonable prorated share, as determined by the agency, of any relocation 
payments that would have been made if the occupants move together to a comparable replacement 
dwelling. Ilowe\er, if the Department detennines that two or more occupants maintain separate 
households within the same dwelling, such occupants have separate entitlements to relocation pay- 
ments. 

(m) For the purpose of purchase and occupancy, the displaced person "purchases" a dwelling when 
he: 

(1) Purchases a dwelling; or 

(2) Purchases and rehabditates a substandard dwelling; (When the replacement dwelling selected by 
the displacee has decent, safe and sanitary deficiencies, the cost to correct deficiencies is eligible 
to the extent that the purchase price, cost of the replacement dwelling, and the cost of correcting 
the deficiencies do not exceed the maximum replacement housing pa> inent based on comparable 
replacement properties); or 

(3) Relocates a dweUing which he or she owns or purchases; or 

(4) Constructs a dwelling on a site he or she owns or purchases; or 

(5) Contracts for the purchase or construction of a dwelling on a site provided by a builder or on 
a site the person owns or purchases; 

(6) Currcntl\- owns a previously purchased dweUing and site, valuation of which shall be on the basis 
ot current fair market value. 

n) In addition to the tenure of occupancy provisions, a displaced person is eligible for appropriate 
payments when he or she relocates and occupies a decent, safe, and sanitary dwelling within a one-year 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1 178 



FINAL RULES 



period (unless extended by the Department for good cause) beginning on the later of the following 
dates: 

( 1 ) The date on which the owner received from the Department fmal payment for all costs of the 
displacement dwelling in negotiated settlements; or in the case of condemnation, the date on 
which the Department deposits the required amount in court, or 

(2) Ihe date the Department has made available to the displacee at least one comparable replace- 
ment dwelling, or 

(3) The date on which the displaced person moves from the displacement dweUing. For tenants 
occupants this is the only pertinent date. 

(4) No person shall be denied eligibility for a replacement housing payment solely because the per- 
son is unable to meet the occupancy requirements set forth in these regulations for a reasons 
beyond his or her control, including: 

(A) A disaster, an emergency, or an imminent threat to the public health or welfare as determined 
by the Department. 

(B) A displaced person who has entered into a contract for the construction or rehabilitation of 
a replacement dwelling and, for reasons beyond his reasonable control, such as delay in con- 
struction, military' reserve duty, or hospital stay, cannot occupy the replacement dwelling within 
the time period as shown in this Rule shall be considered to have purchased and occupied the 
dwelling as of the date of such contract. 1 he replacement housing payment under these condi- 
tions would be deferred until actual occupancy was accomplished. 

(C) A displaced tenant or owner "occupies" a replacement dwelhng within the meaning of this 
Section only if the dwelling is his permanent place of residence, and he satisfied the eligibility 
requirements as set tbrth. 

(o) Betore making payment to the displaced person or releasing a payment from escrow, the De- 
partment must have inspected the replacement dweUing and determined that it meets the standards for 
decent, safe and sanitary housing. The Department may also utilize the services of any public agency 
ordinarily engaged in housing inspection to make the inspection. Such determination by the Depart- 
ment that a dwelling meets the standards for decent, safe and sanitary housing is made solely for the 
purpose of determining the eligibihty of relocated individuals and families for payments under this 
Section and is not representation for any other purpose. Ihe Department will assume no responsibility 
or liability for structural, mechanical, legal, or other unforeseen problems that are discovered after the 
inspection has been conducted. If it is not possible under the circumstances for the Department to 
make the necessary inspection or to secure the needed inspection through a competent third party, a 
certification from the displacee that he has occupied decent, safe and sanitary housing will be sufficient 
to establish the displacee's eligibility for payment. 

(p) Application for Replacement Housing or Rent Supplement payments shall be in writing on a 
form provided by the Department. The application shall be fded within 18 months of displacement 
or in the case of owner-occupant, displacement date or date of final payment, whichever is later. The 
Department may waive this time period for good cause. The Replacement Housing Payment ma> be 
made directly to the relocated individual or family, or upon written instruction from the relocated in- 
dividual or family, directly to the lessor for rent or the seller for use toward the purchase of decent, safe 
and sanitar.' dwelling. In cases where an appUcant otherwise qualifies for replacement and requests the 
Department to do so, such payments shaU be paid into escroyv prior to the displacee's moving. 

(q) No property oyvner yvill be deprived of the earliest possible payment of the replacement housing 
amounts to yy hich he is rightly' due. .\n ady anced replacement housing payment can be computed and 
paid to a property oyvner if the determination of the Department's acquisition pnce yvill be delayed 
pending the outcome of condemnation proceedings. Since the amount of the replacement housing 
payment cannot be determined due to the pending condemnation proceedings, a provisional replace- 
ment housing payment may be calculated by using the Department's yvritten offer for the property as 
the acquisition pnce. Payments of such amount may be made upon the oyvner-occupant's agreement 
that upon tlnal determination of the condemnation proceedings, the replacement housing payment will 
be recomputed using the acquisition price determined by the court as compared to the actual price paid 
or the amount determined by the Department as necessary to acquire a comparable, decent, safe and 
sanitary dwelling. Any agreement prepared must be agreed to and signed by both the oyvner and his 
attomey. If the amount awarded in the condemnation proceeding as the fair market value of the 
property acquired, plus the amount of the recomputed replacement housing payment exceeds the price 
paid for. or the Department s detcnnined cost of a comparable dyvelling. the oyvner will refund to the 
Department from the court ayvard, an amount equal to the amount of the excess. In no event, shall 
he be required to refund more than the amount of the replacement housing payment advanced. If the 



//"9 6:lf> NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



property owner does not agree to such adjustment, the replacement housing shall be deferred until the 
case is finally adjudicated and computed on the basis of the final determination, using the award as the 
acquisition price. 

(r) The displacee should contact and secure from the Relocation Agent his written approval that the 
house proposed for purchase or renting meets decent, safe and sanitary standards. 

(s) Any person who has obtained legal ownership of a replacement dwelling or land upon which his 
replacement dwelling is constructed or moved, either before or after displacement, and occupies the 
replacement dwelling after being displaced but within the apphcable time limit, is eligible for a re- 
placement housing payment if the replacement dwelling meets DSS requirements. The current fair 
market value of the previously owned property (land and improvements) will be used to determine if 
a replacement housing payment is justified. This will apply to remaining land as well. 

(t) If the owner retains ownership of his or her dwelling, moves it from the displacement site and 
reoccupies it on a replacement site, the purchase price of the replacement dwelling shall be the sum of: 

(1) The cost of moving and restoring the dwelling to a condition comparable to that prior to the 
move. 

(2) 1 he cost of making the unit a decent, safe and sanitary replacement dwelling. 

(3) The current fair market v;due for residential use of the replacement site unless the claimant rented 
the displacement site and there is reasonable opportunity for the claimant to rent a suitable re- 
placement site. 

(4) The retention value of the dwelling, if such retention value is reflected in the "acquisition cost" 
used when computing the replacement housing payment. 

(a) A displaced person who initially rents a replacement dwelling and recei\es a rental assistance 
payment is eligible to receive a payment if he or she meets the eligibility criteria for such payments, 
including purchase and occupancy within the prescribed one-\ear period. Any portion of the rental 
assistance payment that has been disbursed shall be deducted from the payment. 

(v) A replacement housing payment is personal to the displaced person and upon his or her death 
the undisbursed portion of any such payment shall not be paid to the heirs or assigns, except that: 

(1) The amount attnbutable to the displaced person's period of actual occupancy of the replacement 
housing shall be paid. 

(2) The full payment shall be disbursed in any case in which a member of a displaced family dies 
and the other family member(s) continue to occupy the replacement dwelling. 

(3) Any portion of a replacement housing payment necessary to satisfy the legal obligation of an 
estate in connection with the selection of a replacement dwelling by or on behalf of a deceased 
person shall be disbursed to the estate. 

(w) When comparable housing within the originally offered replacement housing amount is no longer 
available, the Department will determine a new replacement housing amount based on available 
housing which equal to or better than the subject and meets the other comparable criteria. The re- 
computed replacement housing payment can be lower than the original only if the displaced person has 
not committed to a dwelling based on the original replacement housing payment. In certain instances 
where the Department has been furnished erroneous information by a displacee, it will be permissible 
to recompute a replacement housing payment offer which was based on the confirmed price of a re- 
placement dwelling that "exceeds" the comp;u"ability requirement. For example, if the Department 
leams that the need for additional space, room or special requirement has been eliminated before the 
displacement occurs, then a new payment should be computed to conform to comparability pro\ided 
that the displacee has not actually committed himself in the purchase of a replacement dwelling to the 
extent that he should suffer financial loss if he does not complete the transaction. If he has so com- 
mitted himself, the onginal replacement housing payment will not be revised. This policy will apply 
to both the long and short term owners and tenants. 

(x) Where administrati\e increases are made over and above the approved appraisal, it wlU be nec- 
essary to prorate the increase on claims involving farm acreages, acreage tracts or misplaced improve- 
ments on other lands where the value must be extracted. When a Negotiating Agent settles a claim 
ot this nature for an amount in excess of the appro\ed appraisal, he should ad\ise the owner at the time 
of negotiating the settlement that the replacement housing payment wiU be reduced on a prorated basis 
for the amount of the administrative adjustment which is applicable to the replacement housing pay- 
ment. The Agent should calculate the deduction and advise the owner of the amount of the replace- 
ment housing payment he will receive if he qualifies or get in touch with the Relocation Agent to 
compute any change in the replacement housing payment. 



History Note: Statntoiy Authority G.S. 133-9; 133-10; 133-14; 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1180 



FIP^AL Ri'LES 



l43B-350(fi: 

Eff. November I. 1991. 

.((460 RHPLACEMENT HOUSING PAYMENTS FOR 180 DAY 0\VN,ER-OCCLPANT 

(a) A displaced person is eligible for the replacement housing payment for a 180-day homeowner- 
occupant if the person: 

(1) Has actually owned and occupied the displacement dwelling for not less than 1 80 days imme- 
diately prior to the initiation of negotiations; and 

(2) Purchases and occupies a decent, safe, and sanilari* replacement dwelling within one year after 
the later of the following dates (except that the Department may extend such one-year period 
for good cause). 

(A I The date the person recei\es fmal pa>ment for the displacement dwelling or, in the case of 

condemnation, the date the required amount is deposited in the court, or 
(B) The date at least one comparable replacement dwelling is made available. 

(b) The total replacement housing payment for an eligible 180-day homeowner-occupant is an 
amount not to exceed twent\-two thousand fi\'e hundred dollars ($22,500.00), which is the combined 
sum of: 

(1) The amount by which the cost of a replacement dwelling exceeds the acquisition cost of the 
displacement dwelling, as determined in accordance with Paragraph (c) of this Rule; and 

(2) The amount necessar>' to compensate the displaced person for any increased interest costs and 
other debt service costs to be incurred in connection with the mortgage(s) on the replacement 
dwelling, as determined in accordance with Paragraph (d) of this Rule: and 

(3) 1 he amount of the reasonable expenses that are incidental to the purchase of the replacement 
dwelling, as determined in accordance with Paragraph (e), of this Rule. 

(c) The price differential is the amount which must be added to the acquisition cost of the displace- 
ment dwelling to provide a total amount equal to the lesser of; 

(1) The reasonable cost of a comparable replacement dwelling; or 

(2) The purchase price of the decent, safe and sanitar>" replacement dwelling actually purchased and 
occupied by the displaced person. 

(d) Increased interest payments are pro\ided to compensate a displaced person for the increased in- 
terest costs he is required to pay for increased mortgage interest cost shall be the amount which will 
reduce the mortgage balance on a new mortgage to an amount which could be amortized with the same 
monthly payment for principal and interest as that for the mortgage(s) on the displacement dwelling. 
In addition, payments shall include other dept ser\ ice costs, if not paid as incidental costs, and shall 
be based on bonafide mortgages that were valid liens on the displacement dwelling for at least ISO days 
pnor to the initiation of negotiations. 

( 1) Ihe payment shall be based on the unpaid mortgage balance(s) on the displacement dwelling; 
however, in the event the person obtains a smaller mortgage than the mortgage balance(s) 
computed in the buydown determination, the pa\ menl w ill be prorated and reduced accordingly. 
In the case of a home equity loan, the unpaid balance shall be that balance \s'hich existed ISO 
days pnor to the initiation of negotiations or the balance on the date of acquisition, whichever 
is less. 

(2) The payment shall be based on the remaining term of the mortgage(s) on the displacement 
dwelling or the term of the new mortgage, whichever is shorter. 

(3| Ihe interest rate on the new mortgage used in determining the amount of the payment shall not 
exceed the prevailing fixed mterest rate for con\entional mortgages currently charged by mort- 
gage lending institutions in the area in which the replacement dwelling is located. 

(4) Purchaser's points and ongination fees, but not seller's points, shall be paid to the extent: 
(.\) They are not paid as incidental expenses, 

(B) They do not exceed rates normal to similar real estate transactions in the area, and 

(C) The Department determines them to be necessary, 

(D) The computation of such points and fees shall be based on the unpaid mortgage balance on 
the displacement dwelling, less the amount determined for the reduction of such mortgage bal- 
ance under this Rule. 

(5) Ihc displaced person shall be advised of the appro .ximate amount of this payment and the 
conditions that must be met to receive the payment as soon as the facts relative to the person's 
current mortgage(s) are known and the payment shall be made available at or near the time of 
closing on the replacement dwelling in order to reduce the new mortgage as intended. 



lis I 6:16 ^ORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



(e) The incidental expenses to be paid are those reasonable and necessary' costs actually incurred by 
the displaced person incident to the purchase of a replacement dwelling, and customarily paid by the 
buyer including: 

(1) Legal, closing, and related costs, including those for title search, preparing conveyance instru- 
ments, notary fees, preparing sur\eys and plats, and recording fees. 

(2) Lender, LHA or VA Application and Appraisal Fees. 

(3) Loan origination or assumption fees that do not represent prepaid interest based on the unpaid 
mortgage balance on the displacement dwelling less the buydown amount. 

(4) Certification of structural soundness and termite inspection when required. 

(5) Credit report. 

(6) Owner's and mortgagees' evidence of title, e.g., title insurance, not to exceed the costs for a 
comparable replacement dwelling. 

(7) Escrow agent's fee. 

(8) State revenue or documentary stamps, sales or transfer taxes (not to exceed the costs for a 
comparable replacement dwelling). 

(9) Such other costs as the Raleigh Office determines to be incidental to the purchase. 

(10) If there is no mortgage financing on the displacement dwelhng, closing costs related to new 
mortgage fmancing is not reimbursable. 

History Note: Statutory Authority G.S. 133-9; 133-10; 133-14; I43B-350(f); 
Eff. November I, 1991. 

.0461 PAYMENT TO 0V\M:R-0CCL PANTS OF 180 D.\YS WTiO RENT 

A 180-day owner eligible for a replacement housing payment who elects to rent a replacement dwelling 
is eligible for a payment not to exceed five thousand two hundred and fifty dollars ($2,250.00). The 
payment shall be computed and disbursed in accordance with Rule .0462(b) of this Section. 

Historx' Note: Statuton- Authority G.S. 133-9; 133-10; 133-14; l43B-350(f); 
Eff. November I. 1991. 

.0462 PAYMENT TO 0\\>.ER OR OCCl PANT - 90 DAYS 

(a) A tenant or owner-occupant displaced from a dwelling is entitled to a payment not to exceed five 
thousand two hundred fifty dollars ($5,250.00) for rental assistance, as computed in accordance with 
Paragraph (c) of this Rule, if such displaced person: 

(1) Has actually and lawfully occupied the displacement dwelling for at least 90 days immediately 
prior to the initiation of negotiations; and 

(2) Has rented, or purchased, and occupied a decent, safe and sanitary replacement dwelling within 
one year after: 

(A) In the case of a tenant, the date he or she moves from the displacement dwelling, or 

(B) In the case of an owner-occupant, the later of 

(i) The date he or she receives fmal payment for the displacement dwelling, or in the case of 

condemnation, the date the required amount is deposited in the court; or 
(ii) The date he or she moves from the displacement dwelling. 

(b) /Vn ehgible displaced person who rents a displacement dwelhng is entitled to a payment up to, 
but not to exceed five thousand two hundred fifty dollars ($5,250.00) for rental assistance. Such pay- 
ment shall be 42 times the amount obtained by subtracting the base monthly rental for the displacement 
dwelling from the lesser of 

(1) The monthly rent and estimated average monthly cost of utihties for a comparable replacement 
dwelling; or 

(2) The monthly rent and estimated average monthly cost of utilities for the decent, safe and sanitary 
replacement dwelling actually occupied by the displaced person. 

(c) The base monthly rental for the displacement dwelhng is the lesser of 

(1) The average monthly cost for rent and utihties at the displacement dwelling for a reasonable 
period prior to displacement, as determined by the Department. (For an owner-occupant, use 
the fair market rent for the displacement dwelling. For a tenant who paid little or no rent for 
the displacement dwelling, use the fair market rent, unless its use would result in a hardship 
because of the person's income or other circumstances.), or 

(2) Thirty percent of the person's average gross household mcome. (If the person refuses to pro\ide 
appropriate evidence of income or is a dependent, the base montlily rental shall be established 



6:16 NORTH CAROLINA REGISTER November 15, I99I 1IS2 



FI^AL RULES 



solely on the criteria in Paragraph (c) (1) of this Rule. A full-time student or resident of an in- 
stitution may be assumed to be a dependent, unless the person demonstrates otherwise, or 
(3) The total of the amounts designated for shelter and utilities is receiving a welfare assistance 
payment from a program that designates the amount for shelter and utilities. 

(d) Ihe pa\ment under this Rule shall be disbursed in a lump-sum amount, unless the Department 
dctennincs on a casc-by-case basis, for good cause, that the payment should be made in installments 
or the displaced person requests periodic payments. The full amount vests immediately, whether or 
not there is any later change in the person's income or rent, or in the condition or location of the per- 
son's housing. 

(e) An eligible displaced person who purchases a replacement dwelling is entitled to a down payment 
assistance payment in the amount the person would rccene if the person rented a comparable replace- 
ment dwelling. .\ down payment assistance payment may be increased to any amount not to exceed 
the thousand two hundred and fifty dollars ($5,250.00) including incidental costs if the rental assistance 
payment is less than five thousand two hundred and fifty dollars ($5,250.00). When the rental assist- 
ance pa\mcnt exceeds fi\'e thousand two hundred and fift\' dollars ($5,250.00), the down pa\ment as- 
sistance payment will be based on the amount required to obtain conventional financing for the 
purchase of a decent, safe and sanitarv' replacement dwelling as determined by the Department but not 
to exceed the amount of the rental assistance pavmcnt. However, the payment to a displaced home- 
owner shall not exceed the amount the owner would receive if he or she met the 180 day occupancy 
requirement. A displaced person eligible to receive a replacement housing pavment as a 180-day 
homeowner-occupant is not eligible for this payment. The full amount of the replacement housing 
payment for down payment assistance must be applied to the purchase price of the replacement 
dwelling and related mcident;d expenses. 

(f) It is necessary that tenants be infonned that should they choose public housing, the payment will 
be computed based on what they pay for rent at the public housing unit. 

Iliston Sole: Siatuion Authotitv G.S. 133-9; 133-10: 133-14: l43B-350ifj: 
Eff. Sovembcr I. 1 99 1. 

.0463 PAVMKM K) TENAM OR OWNER - LESS I HAN 90 DAYS 

(a) This Rule applies to tenants who have occupied a dwelling for less than 90 days prior to the ini- 
tiation of negotiations or who began to occupy it after the initiation of negotiations and who are in 
occupancy at the time the Department obt;iins legal possession of the property (closing date or date 
of tiling in a condemnation proceeding). 

( 1) All provisions of previous rules ma_v apply to these occupants (i.e., moving payments, relocation 
assistance, 90-day notice) including rental assistance payment if comparable replacement rental 
housing is not available at rental rates within the person's fmancial means, v\iTjch is 30 percent 
of the person's gross monthly household income. Such assistance shall cover a penod of 42 
months. This payment will be paid under last resoit housing. 

(2) If the less than 90-da_v tenant is eligible for a pavment and purchases a decent, safe and sanitarv' 
dwelling, the down payment will be the lesser of the computed rent supplement or the required 
down payment on the propertv purchased. This pavment will be paid under last resort housing. 

(b) There is no provision for a replacement housing payment to owners of less than 90 days. They 
are eligible for moving costs only. 

Iliston Sole: Staiuion Authority G.S. 133-9; /33-JO: 133-/4: J43B-350if): 
Eff. Xovembcr I. 1991. 

.0464 MOBILE HOMES 

(a) .\ ten.int or ov\ner-occupanI deplaned from a mobile home, or mobile homesite, is entitled to a 
payment for the cost of moving his or her personal property on an actual cost basis or, as an alternative, 
on the basis of a fixed pa\ ment as described in the applicable Department schedule. 

(1) If a displaced mobile home owner (including a non-occupant owner) files a claim for actu.il 
moving expenses for moving the mobile home to a replacement site, the reasonable cost of dis- 
assembling, moving, and reassembling any attached appurtenances (such as porches, decks, 
skirting, and awnings) which were not acquired, cmchoring of the unit, and utihty "hook-up" 
charges are reimbursable. 



//.V.-f 6:16 NORTH CAROLINA REGISTER November 15, 1 99 1 



FINAL RULES 



(2) If the mobile home is not acquired but the owner obtains a replacement housing payment under 
one of the circumstances described in Paragraph (c)(3) of this Rule the owner is not ehgible for 
moving personal property from the mobile home. 

(3) If a mobile home requires repairs or modifications to enable it to be moved to a replacement site, 
and the Department determines that it is practical to do so. payment shall be limited to the 
reasonable costs of moving the mobile home and making such repairs or modrfications. 

(b) Nonretumable entrance fees are reimbursable as part of actual cost moving expenses unless the 
Department determines that comparable mobile home parks are available which do not require en- 
trance fees. 

(c) A displaced owner-occupant of a mobile home is entitled to a replacement housing payment not 
to exceed twenty-two thousand five hundred dollars ($22,500.00) if; 

(1) The person both owned the displacement mobile home and occupied it on the displacement site 
for at least 180 days immediately prior to the initiation of negotiations; 

(2) The person meets the other basic eligibility requirements; and 

(3) The Department acquires the mobile home as real property, or the mobile home is not acquired 
by the Department but the owner is displaced because the Department determines that the 
mobde home; 

(A) Is not decent, safe and sanitary; or 

(B) Cannot be mo\ed without substantial damage or unreasonable cost; or 

(C) Cannot be moved because there is no available comparable replacement site; or 

(D) Cannot be moved because it does not meet mobUe home park entrance requirements. 

(E) If the mobile home is not actually acquired, and the Department determines that it is not 
practical to relocate it, the acquisition cost of the displacement dwelling is used for the purpose 
of computing the price differential amount, shall include the salvage value or trade-in value of 
the mobile home, whichever is higher. 

(d) A displaced person or owner-occupant of a mobile home is eligible for a replacement housing 
payment, not to exceed five thousand two hundred fifty dollars ($5,250.00), if; 

(1) The person actu;dly occupied the displacement mobde home on the displacement site for at least 
90 days immediately prior to the initiation of negotiations; 

(2) The person meets the other basic eligibility requirements of Rule .0462 (a) of this Section; and 

(3) The Department acquired the mobile home as real property, or the mobile home is not acquired 
by the Department but the owner or tenant is displaced from the mobile home because of one 
of the circumstances described in Rule .0464 (3) of this Section. 

(e) A displaced mobile home occupant may have owned the displacement mobile home and rented 
the site or may have rented the displacement mobile home and owned the site. Also, a person may 
elect to purchase a replacement mobile home and rent a replacement site, or rent a replacement mobile 
home and purchase a replacement site. In such cases, the total replacement housing payment shall 
consist of a payment for a dwelling and a payment for a site, each computed under the apphcable 
Section in Rule .0460 (b), (d), (e). Rule .0461 (a), and Rule .0462 (b). (c). However, the total re- 
placement housing pa\ment to a person shall not exceed the maximum payment (either twenty-two 
thousand five hundred dollars ($22,500.00 or five thousand two hundred fifty dollars ($5,250.00)] per- 
mitted under the Rule that governs the computation of the replacement housing payment or rental 
assistance payment. 

(f) When computing the amount of a replacement housing payment for a person displaced from a 
mobile home, the cost of a comparable replacement dwelling is the reasonable cost of a comparable 
replacement mobde home, including the site. This applies whether the displaced person's actual re- 
placement dwelling is another mobile home or a con\'entional home. 

(g) if a comparable replacement mobUe home is not available, the replacement housing payment shall 
be computed on the basis on the reasonable cost of a comparable conventional dwelling. 

(h) It the Department determines that it would be practical to relocate the mobile home, but the 
owner-occupant elects not to do so, the Department may determine that for purposes of computing the 
price ditlerential, the cost of a comparable replaccmemt dwelling is the sum of; 

(1) The value of the mobile home: 

(2) I he cost of any necessarv' repairs or modifications; 

(3) The estimated cost of moving the mobile home to a replacement site. 

(i) If a mobile home is not actually acquired, but the occupant is considered displaced under these 
Regulations, the 'initiation of negotiations' shall be the date of the initiation of negotiations to acquire 
the land, or, if the land is not acquired, the date the occupant is notified in writmg that he or she is a 
displaced person for the purposes of these Regulations. 



6.76 AORTH CAROLINA REGISTER November 15, 1991 1184 



FINAL RULES 



(\) If the owner is reimbursed for the cost of moving the mobile home under these Regulations, he 
or she is not eligible to receive a replacement housing payment to assist in purchasing or renting a re- 
placement mobile home. The person may, however, be eligible for assistance in purchasing or renting 
a replacement site. 

(k) The acquisition of a portion of a mobile home park property may leave a remaining part of the 
property that is not adequate to contmue the operation of the park. If the Department determines that 
a mobile home occupant located in the remaining part of the property is required to move, such an 
occupant shall be considered displaced by the project and entitled to the relocation payments and other 
assistance in these Regulations. 

History Xote: Statutory Authoritv G.S. 133-9: 133-10; 133-/4; 143B-350(f); 
Eff. Wovember I. 1 90 1. 

.0465 HOLSrSG OF LAST RESORT 

(a) Whenever a project cannot proceed on a timely basis because comparable replacement dwellings 
are not available within the monetar\- Limit of twenty-two thousand five hundred dollars ($22,500.00) 
for owners and five thousand two hundred fifty dollars ($5,250.00) for tenants, the Department shall 
provide additional or alternate assistance under the provisions of replacement housing of last resort. 
Any decision to provide last resort housing assistance must be adequately justified either: 

(1) On a case-by-case basis, for good cause, which means that appropriate consideration has been 
given to: 

(A) The availability of comparable housing in the project area. 

(B) The resources available to provide comparable housing. 

(C) The individual circumstances of the displaced person. 

(2) By a determination that: 

(.\) There is httle, if any, comparable replacement housing available to displaced persons within 
the project area and, therefore, justification for last resort housing assistance may be necessary 
for the project. 

(B) The project cannot be advanced to completion in a timely manner without last resort housing 
assistance. 

(C) The method selected for providing last resort housing assistance is cost effective, considering 
all elements which contnbute to total project costs. 

(b) The Raleigh OlTice will approve all requests for last resort housmg. A written report concerning 
the details for special situations will be forwarded to the Raleigh OlTice in order that a decision can be 
reached and the situation be resolved. 

(c) No person shall be required to move from a displacement dwelling unless comparable replacement 
housing is available to such person. No person may be deprived of any rights the person may have 
under Section .0400 of this Subchapter or replacement housing of last resort. The Department shall 
not require any displaced person to accept a dwelling provided by the Department under these proce- 
dures (unless the Department and displaced person have entered into a contract to do so) in lieu of any 
acquisition payment or any relocation payment for which the person may otherwise be eligible. 

(d) rhe Department has board latitude in implementing housing of last resort, but implementation 
shall be for reasonable cost, on a case-bv-case basis unless and exception to case-by-case analysis is 
justified for an entire project. The methods of providing housing of last resort include, but are not 
limited to: 

(1) A replacement housing payment in excess of the twenty-five thousand dollars ($25,000.00) and 
five thousand two hundred fifty dollars ($5,250.00) hmits. (A rental assistance subsidy may be 
provided in monthly installments or in a lump sum at the Department's discretion.) 

(2) Rehabilitation of and or additions to an existing replacement dwelling. 

(3) The construction of a new replacement dwelling. 

(4) The provision of a direct loan, which requires regular amortization or deferred payment. The 
loan may be unsecured or secured by the real property. The loan may bear interest or be 
interest-free. 

(5) The relocation, and. if necessary, rehabilitation of a dwelling. 

(6) The purchase of land and or a replacement dwelling by the Department and subsequent sale 
or lease to, or exchange with, a displaced person. 

(7) The removal of bamers to the handicapped. 



US5 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



(8) The change in status of the displaced person from tenant to homeowner when it is more cost- 
effective to do so, as in cases where a down payment may be less expensive than a last resort 
rental assistance payment. 

(9) Under special circumstances consistent with the defmition of a comparable replacement dwell- 
ing, modified methods of providing housing of last resort permit consideration of: 

(A) Replacement housing based on space and physical characteristics different from those in the 
displacement dwelling. 

(B) Upgraded, but smaller, replacement housing that is decent, safe and sanitary and adequate to 
accommodate individuals or famihes displaced from marginal or substandard housing with 
probable functional obsolescence. In no event, however, shall a displace person be required to 
move into a dwelling that is not functionally equivalent as described in Rule .0441 (b)(2) of this 
Section. 

(C) The Department may use replacement housing of higher density in computing the replace- 
ment housing payment if comparable single-family housing is not available. Also, a mobile 
home may be used for a single-family residence where comparable conventional dwellings are 
not available. 

(10) The Department shall provide assistance under housing of last resort to a displaced person who 
is not eligible to receive a replacement housing payment because of failure to meet the length 
of occupancy requirement when comparable replacement rental housing is not available at rental 
rates within the person's financial means, which is 30 percent of the person's gross monthly 
household income. Such assistance shall cover a period of 42 months. 

History Sole: Statutory Authority G.S. 133-10. 1: 133-/4; I43B-350(fj; 
Eff. Sovember I, 1991. 

.0466 DISPLACEMENTS CAUSED BY DISASTERS OR EMERGENCIES 

(a) Should a major disaster or an emergency condition cause a person who is located on an active 
right of way project to move before the project would require the move, the Federal Iligliway .Ad- 
ministration may grant a wai\cr of the policy on making housing available. 'I'he waiver ma\ be given 
where it is demonstrated that a person must move because of: 

(1) A major disaster as defined in Section 102(c) of the Disaster Relief Act of 1974 (42 U.S.C. 5121); 
or 

(2) A Presidentially-declared national emergency; or 

(3) Another emergency which requires immediate vacation of the real property, such as when con- 
tinued occupancy of the displacement dwelling constitutes a substantial danger to the health or 
safety of the occupants or the pubhc. 

(b) Whenever a person is required to relocate for a temporary period because of an emergency as 
described in Paragraph (a)(1), (2), and (3) of this Rule, the Department sh;dl: 

(1) Take whatever steps are necessar>' to assure that the affected person is temporarily relocated to 
a decent, safe, and sanitary dwelling. 

(2) Pay actual reasonable out-of-pocket moving expenses and any reasonable increased in monthly 
housing costs incurred in connection with the tcmporarv" relocation. 

(3) Make available to the displaced person as soon as feasible, at least one comparable replacement 
dwelling. (For purposes of filing a claim and meeting the eligibility requirements for a relocation 
payment, the date of displacement is the date the person moves from the temporarily occupied 
dwelling.) 

(c) To the extent necessar>' to avoid dupUcate compensation, the amount of any insurance proceeds 
received by a person in connection with a loss to the displacement dwelhng due to a catastrophic oc- 
currence (e.g. fire, flood, etc.) shall be included in the acquisition cost of the displacement dwelhng 
when computing the price differential. 

Histoiy ><ote: Slatutoiy Authority G.S. 133- N: l43B-350(f); 
Eff. Xovember I, 1991. 

SECTION .0500 - LTH ITV ENCROACHMENTS 

.0503 APPLICATION FOR UTILITY ENCROACHMENTS 



6:16 NORTH CAROLINA REGISTER November 15, 1991 11 S6 



FINAL RULES 



(a) The applicant for a utility encroachment agreement shall prepare four copies of the standard 
encroachment agreement on forms which are available from Di\ision and District Engineers Offices 
or from the State Utility Agent, Highway Building, Raleigh, N. C. 

(b) The application shall include, or by reference incorporate: 

(1) The state standards for accommodating utilities: 

(2) A general descnption of the size, type, nature and extent of the proposed utilities; 

(3) Adequate drawings or sketches showing the existing and or proposed location of the utility fa- 
cilities within the highway, the traveled way, the rights-of-way lines, and where applicable, the 
control of access lines and approved access points. Where facilities of another utility are to be 
unearthed, or exposed to potential damage, drawings shall show as nearly as possible the lo- 
cation of said facilities; 

(4) The extent of liability and responsibilities associated with future adjustment of the utilities to 
accommodate highway improvements; 

(5) The action to be taken in case of noncompliance with state requirements; and, 

(6) Other provisions as deemed necessary. 

(c) Plans showing details of structure attachments shall he furnished the Head of Structure Design for 
approval before the encroachment agreement is submitted. 

History Sole: Slatulorv Authority G.S. 136-18(5); 136-18(10); 136-03; 
F.ff. April 3. 1981: 
Amended Eff. \ovember I, 1991. 

.0515 RILOCATION OF L TILITIES KNCOL^TKRKD IN HICHW AV IMRRO\ EMENTS 

(a) The Department of Transportation shall assume the financial responsibility for non-betterment 
costs of adjusting or relocating utilities when the conflicting utilities are occupying a valid utility right 
of way. A valid utilit_\ right of way for the purpose of this policy is one in which the .Municipality or 
other utility owner has a compensable interest. The Department of Transportation, upon the request 
of the .Municipality or other utility owner, may pro\ide the engineering and include the utility adjust- 
ment or relocation in the highway improvement contract at no cost to the Municipality or other utility 
owner. 

(b) I'he Department of Transportation shall assume the financial responsibdity for the non- 
betterment cost of adjusting or relocating those municipaUy-owned utilities necessitated by highway 
construction when said utilities are located on a non-s> stem right of wa\ presided that: 

( 1 ) the highway construction does not constitute an improvement to the non-system street in which 
the utilities are located, and 

(2) the non-s\stem street in which the utilities are located is not incorporated into or obUterated by 
the highway project. The mere crossing of a project by a street either at-grade or b\ separation 
shall not constitute "incorporation" into the project. 

(c) The MunicipaUtN" or other utility owner is financially responsible for the adjustment or relocation 
of utilities in conflict with a highway improvement when such utilities are located within the existing 
right of way of a State system highway, except as provided for in G.S. 136-27.1 as follows: Ihe De- 
partment of Transportation shall pay the non-betterment cost for the relocation of water and sewer 
Hnes, located within the e.^dsting State highway right of way, that are necessar)' to be relocated for a 
State highw^ay improvement project that are owned by: 

(1) a Municipality with a population of 5,500 or less according to the latest decennial census; 

(2) a nonprofit water or sewer association or corporation: or 

(3) any water or sewer s\stcm organized pursuant to (.'hapter I62-A of the General Statutes. 

(d) The owner of the utility is financially responsible for the adjustment or relocation of utilities in 
conflict with a highway improvement when such utilities are located on a non-valid utiUty easement. 

(e) The Department of Transportation may enter mto agreements with Municipalities or other utility 
owners to provide that the necessar>" engineering and utility construction be accomplished by the De- 
partment on a reimbursement basis as follows: 

( 1) Reimbursement to the Department wiU be due after completion of the work and within 60 days 
after date of invoice. 

(2) Interest shall be paid at the rate of eight percent on any unpaid balance due. 

(f) Should a Municipality fail to pay the Department of Transportation in accordance with the pro- 
\isions of the Ltihty Agreement, the Department may apply up to ten percent of each \"ear's allocation 
of the Municipality s share of funds allocated under the pro\isions of G.S. 136-41.1 (Powell Bill) until 
the Municipality's obligation is paid. 



lis- 6:16 SORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



(g) In those cases where no agreement can he reached, or in cases where the utihty owner refuses to 
relocate or refuses to claim ownership, the Board shall issue an order on the authority of G.S. 
136-18(10) requiring the necessary' adjustments. Upon failure of the utility to comply with the order, 
all utility construction shall be included in the highway impro\ement contract. Upon completion of 
the work, the owner of the utility shall be invoiced for the work performed. If the in\oice is not paid, 
the Board of I'ransportation shall refer the matter to the Office of the Attomey General for further 
action. 

History Note: Statutory Aitthoritv G.S. 136-18(10): 136-27.1: 136-93: 
Eff. November I. 1991. 

SUBCHAPTER 2C - SKCONDARY ROADS SECTION 

SECTION .0100 - SECONDARY ROADS 

.0105 PROPER rv OWNER PARIICIPATION PAVING 

(a) Subdivision- Residential Roads. Those roads which are eligible to be paved on a participating 
plan will be administered according to the following procedure: 

(1) The property owners or their representative will contact the division engineer or his represen- 
tative to determine whether or not the road in question is eligible for paving on a participating 
basis. 

(2) If the di\ision engineer or his representati\e determines that the road in question is ehgible to 
be paved on a participating basis, he will so inform the property owners or their representative. 
He will then make a survey to determine the length of the road in question and will submit to 
the property owners or their representative a letter stating the cost, at a rate of four dollars 
($4.00) per linear foot, each side, to the property owners for the road to be pa\ed and the ap- 
proximate date when the work can be completed. 

(3) The property owners must then present to the division engineer or his representative a certified 
check made payable to the Department of Transportation, Division of Highways for the entire 
amount as stated in Paragraph (2) of this Rule. Once this has been accomplished, work will 
proceed as soon as forces and supplemental funds are available. 

(b) Rural Roads. 

(1) The Board of Transportation will allow the paving of a rural road on a property owners' par- 
ticipation basis identical in cost of four dollars ($4.00) per foot along each side as required for 
unpaved subdivision residential roads. This is on a first-come, first-served basis. A section of 
Riral unpaved road to be paved under this policy will be at least 0.30 of a mile in leng:th provided 
the road is more than 0.30 of a mile in length. The section to be paved can be at the beginning, 
middle, or end of an unpaved road and need not connect to existing pavement. 

(2) The Board of Transportation Member reserves the right to detennine whether or not the amount 
of funds needed to supplement the property owners' amount is justified based upon the paving 
priority, the total cost of the road as compared to the amount of funds received by the county, 
and the potential future development that would improve the established paving priority. 

(3) If the four doUars ($4.00) per foot required along each side of the road does not generate enough 
funds from the property owners to justify supplementing the state funds needed, the Board of 
Transportation .Member, after consultation with the division and district engineers, may then 
negotiate and recommend to the Board of Transportation a pcr-foot cost to the propeilv owners 
which will better justify the supplementing of state funds to pave the road. 

iIistor\' Note: Statutor]' Authority G.S. 136-44.1, 136-44.2: 136-44.7; 
Eff. Julv /, 1978; 
Amended Eff. November I, 1991; July I. 1984: October I, 1982. 

.0110 IMPRON EMENES FOR ESDUSTRIAE: M.ANUFACTl RING PRO.IECTS 

(a) 'The Board of Transportation will review requests for access road improvements to industrial or 
manufactunng projects as a part of the statewide etf'oil to attract new industry to North Carolina. 
Projects eligible tor assistance trom the Department of Transportation mav be any industrial or man- 
ufacturing lactorv', mill, assembly or fabricating, or industrial research development or laboratory facil- 
ity, or industrial processing facility, or expansion of existing such facilities. The Board of 
Transportation will individually review the economic impact of the location of distribution facilities for 



6:16 NORTH CAROLINA REGISTER November 15, 1991 IISS 



FINAL RULES 



distnbuting inanutactured goods. The number of employees and truck traffic will be primary justi- 
fication for assistance with road improvements. Approval of such requests will be based primarily upon 
the initial number of employees as compared to the road impro\'ement cost. The initial investment in 
the project and the precedent of past approvals by the Board of Transportation for sunilar projects will 
be considered. The particular county Ln\()lved will be considered as to current economic development. 

(b) In the case of Paragraph (a) of this Rule, the access road improvements wdl be along an alignment 
determined b>' the Department of Transportation, and the right-of-way will be dedicated at no cost to 
the Department of Transportation. Such access road improvements wUl terminate at the property hne 
of the project. The road improvements in\olved must become a part of the state maintained system 
as required b\ North Carolina General Statutes. 

(c) The Board of Transportation u ill consider the addition of an access road constructed by others 
to the state maintenance system provided it is justifiable based upon the existing .Access and Public 
Service Road Policy. The construction standards for such a road wiU be determined by the Division 
Engineer based upon the intended use of the roadway. 

Uiston Sote: Statutory^ Authority G.S. 136-44.1: I43B-350(f); l43B-350(g); 
F.ff. Jidv /, 197S: 
Amended Eff. \ovember J. 1991. ■ July I. I9S4. 

.0112 STATEMKNT OF POLICY 

(a) General Hligibility of Roads 

( 1 ) The Board of Transportation recognizes that aU roads with the required number of occupied 
homes should be eligible for consideration for addition to the State Maintenance S>"stem without 
cost to the property owners. 

(2) The Board of Transportation will consider, for addition to the State System, an>" road with a 
right of way recorded or construction 5t;u1cd prior to October 1, 1975, for state maintenance 
\\ithout the property owners bearing any cost. 

(3) 1 he ehgibdity for consideration of such roads uiil be that the roads serve the required number 
of occupied homes and the cost for addition to the State Maintenance System will be reasonable 
when compared to the number of occupied homes ser\ed. In the case of subdi\ ision roads, the 
property abutting the roads must be basically fuUy developed. 

(b) L npa\ed Subdivision Roads 

( 1 ) The Board of Transportation \\ ill consider unpa\ ed subdiv ision roads constnicted before Octo- 
ber I, I9''5. for addition to the State .Maintenance System provided the roads serve the required 
number of occupied homes and the roads are built to the minimum unpaved construction 
stimdards of the Department of Transportation. 

(2) The roads will be subject to propertv' owners' participation for pavmg once the\ become a part 
of the State Maintenance System. 

(3) i liis policy will allow the requirement that a subdivision road be paved to minimum Department 
of Transportation standards to coincide with the North Carolina General Statute, 136-102.6, 
enacted October 1. 1975. This law requires that public roads recorded from October 1, 1975, 
must be buUt to the minimum constniction standards of the Department of Transportation. 
The minimum construction standards include the rct|uirement that a subdivision road be paved. 

(c) Addition of Cul-de-sacs. The Board of Transportation currently requires that cul-de-sacs ot 0.20 
rrdle or less serve at least four occupied homes before qualifying for addition to the State Maintained 
System. The Board of Transportation recognizes that many cul-de-sacs have been denied state main- 
tenance in the past due to driveway locations or less than four lots being located around the cul-de-sacs. 
Therefore, the Board of Transportation wiU consider the addition of cul-de-sacs constructed, recorded. 

or with prelimmaPi" county planning board approval before October 1, 1975, which serve less than lour 
occupied homes to the State .Mamtained System prov ided: 

( 1 ) 1 he cul-de-sac is fuUv developed. 

(2) At least two occupied homes are served. 

(3) At least two individual property owners are involved. 



Histoiy .\ote: Stalutor}- Authoniv G.S. 136-44.1 . 136-44.10: 

136-102.6: l43B-350(f): l43B-3M)a i: I53A-205: 

Eff. Jidv I. I97S: 

Amended Eff. Xovember 1. 1991: October 1. 19S2. 



IIS9 6:16 NORTH CAROLL\A REGISTER November L\ 1991 



FINAL RULES 



.0114 SCHOOL BUS I)R1\ KS AND SCHOOL BUS PARKING AREAS 

The Department of Transportation is authorized to construct and maintain school bus drives and 
school bus parking areas at pubhc schools, h is the policy of the Board of Transportation to pave a 
school bus drive and stabilize a school bus parking area at pubhc schools with expenditures being 
limited to fifty thousand dollars ($5fl,()()0) per school site. 

History \ote: Stamton' Authority G.S. 136-18(17 ); 
Eff. November I. 1991. 

.0115 RIRAL \ OLLATEER FIRE AND RESCl E SQUAD FACILITIES 

It is the present policy of the Board of Transportation to finance the construction of entrance 
driveways to the N'cliicle bays of rural \'olunteer firehouses approved by the North Carohna Fire In- 
surance Rating Bureau and the vehicle bays at rural rescue squad facdities approved by the North 
Carolina State Association of Rescue Squads, Inc. It is also the pohcy of the Board of Transportation 
to provide maintenance improvements to those areas previously constructed by the Department of 
Transportation. The justiilcation is based upon requested inspection from the facihty to the distnct 
or division engineer invohed. The cost of the maintenance improvement will be reasonable in nature 
and will be subject to availabihty of funds from the Second;ir>' Road Fund allocation to the counties. 
It is the intention of this policy revision to maintain what has been previously pro\ided to the facility 
or what will be provided to a new facihty in the future. 

Uisioty Note: Slatuton Authority G.S. 136-18(24): 
Eff. November /. 1991. 

SUBCHAFI ER 2D - HKillWAV OPERA I IONS 

SECTION .0400 - FIELD OPERATIONS - MAFNTENANCE AND EQUIPMENT 

(1401 HIGHWAY MAINTENANCE CONTRACT RETREATMENT PROGRA.M 

Histoty Note: .Statutofy Authority G.S. 136-44.3: 136-44.1 : 
l43B-35b( fi : l43B-350{g ); 
Eff. July I. 1978: 
Repealed Eff November I, 1991. 

.0407 HIGHWAY AND SIREET PLANTING IN ML^ICIPALIFIES 

Ilistoiy Note: Statutoty Authority G.S. 136-66.1 : 

1 43 B- 346; l43B-350(f): /43B-350(g): 

Eff July /, 1978; 

Repealed Eff November I, 1991. 

.0410 RENTAL OF SUPPLEMENTAL EQUIPMENT 

Ihe Department of Iransportation. consistant with its needs and the a\"ailability of state-owned 
equipment, may supplement its own equipment requirements by the rental of pri\ately owned. Op- 
-■rator may also be furnished with equipment. 

Uistor\: Note: Statutor\- Authority G.S. I43B-346: 1433-350(0; l43B-350(g); 
Eff July I. 1978; 
Amended Eff November /, 1991. 

0414 LOCATION OF GARBAGE COLLECTION CONTAESERS 

Permits for the placement of garbage collection containers may be issued only under the following 
:ircumstances: 

( 1 ) No garbage collection container site shall be located on any State highway nghts-of-wa\ except 
by written authorization of the Department of Transportation signed by the State Highway Ad- 
ministrator. 

(2) No garbage collection container shall be located within .^00 feet of an occupied dwelling unless 
the apphcant obtains written permission from the owner of the dwelling. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1190 



FINAL RULES 



(3) An application for a site permit may be obtained from and shall he submitted to the District 
Ingincer for the county in which the garbage container is proposed to be located. 

(4) Guidelines for container sites are as follows: 

(a) The count\ or municipaUty requesting the permit shall be responsible for any work to be per- 
formed in preparation of the site. Any work performed on the site by the Department of 
Transportation will be on a reimbursable basis in accordance with rules 19.-\. NC"A(" 2F,.0501 
and 19A NCAC 2E.05(J2. 

(b) Container sites adjacent to pa\ed roadways shall be constructed to standards as required b) the 
District Engineer. 

(c) Container sites adjacent to unpaved roads shall he prepared with matenals similar to those ex- 
isting on the tra\eled portion of the roadway. 

(5) When container sites are located in areas requinng drainage, proper drainage shall be provided 
as directed by the District Engineer or his representative. 

(6) Whenever container sites are located adjacent to the roadway, minimum adequate sight distances 
shall be provided for the vehicle entering the road from the container site. 

(7) Container sites shall be permitted adjacent to roadways only v\hen safe lateral clearances can be 
provided from the edge of pavement to the container. The District Ingineer shall determine the 
safe lateral clearances to be pro\ided at each site. 

(8) The county or municipality which holds a permit for the placement of garbage collection con- 
tciiners as provided herein shall maintain an adequate collection schedule in order to prevent 
spillage or overilow from said containers and shall keep the site free from all garbage and trash 
other than that which is within the garbage collection containers which are authorized by the 
permit. 1 he District I'ngineers shall gi\e wntten notice to the county or municipality of any failure 
to comply with this requirement. If a county or municipality which is so notified does not bring 
the site within compliance of the requirement within 3U days of receipt of the written notice, the 
District Engineer shall then revoke the permit and dispose of the garbage collection containers 
accordingh'. 

Note: A booklet describing the guidelines used by the Department of transportation in granting per- 
mits is available from the Office of the [district Engineer or the .Manager, Design IJranch, Division of 
Highways, Raleigh, \. C. 2761 1 free of charge. 

History Sole: Lef^islaihe Objeciion [la) J Lodged Eff. August 19. 1980; 
Legislath-e Objection [{alj Removed Eff. April 23. 19SI: 
Statutory Authoritv G.S. 136-IS.3: 136-18(10): 
Eff. Juh- f /9"8: 
Amended Eff October /, 199 f- April 3, 1981: April If 1980. 

.0416 BRID(,E BKHXTEN MORKHK AD ( ITV AM) All A.MIC BEACH 



History Sote: Staiutoty Authoritv G.S. 136-18(5); 
Eff July I. 1978: ' 
Amended Eff August 10. 1981: 
Repealed Eff Sovember f I99L 



.0417 BRIDC.E ON IS 17 0\ ER NELSE RH ER Al NEW BERN 

(a) The draw shall open on signal except that the draw may remain closed: 

(1) from Monday through Friday from 6:30 a.m. to 8:30 a.m. and 4:00 p.m. to 6:00 p.m. for 
pleasure vessels; however, the draw shall open at 7:30 a.m. and 5:00 p.m. for any vessel waiting 
to pass: and 

(2) Sundays and Federal holidays from .May 24 througli .September 8 from 2:00 p.m. to 7:00 p.m. 
for pleasure vessels except that the draw shall open at 4:00 p.m. and 6:00 p.m. for any vessels 
waiting to pass. 

(b) The draw shall always open on signal for public vessels of the Inited States, State, or loc;d vessels 
used for public safety, tugs with tows and vessels in distress. 

History \ote: Statuton .Authority G.S. I36-IS{5); 
Eff July I. 1978; 
Amended Eff \ovember I. 1991: August 10, 198 f 



1191 6:16 SORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



.0425 FEDERAL DISASl ER ASSISTANCE 

The Manager of the Maintenance and Equipment Branch is subdelegated the duty and authority by 
the State Highway Adnunistrator to execute applications, assurances and agreements and other docu- 
ments on behalf of the Department of Transportation necessar\' to receive Federal Disaster Assistance 
from the Federal Emergency Management Agency. 

History Note: Staiuton,' Authority G.S. / 36-/8; 136-4: I43B-350; 
Eff. October I, IQ9I. 

.0426 BRIDGE ON US 70 0\ ER BEAl EORT CHANNEL AT BEAUFORT 

The draw shall open on signal, except that from 7:30 a.m. to 7:30 p.m. the draw shall open for pleasure 
craft on signal every hour on the half hour from .May 1 to October 31. 

History Note: Statutory' Authority G.S. I36-IS(5); 
Eff. November I, 1991. 

.0427 BRIDGE ON NC 50 OVER INTERCOASTAL WATERWAY AT SURF CITY 

The draw shall open on signal, except that from 7:00 a.m to 7:00 p.m. the draw shall open for 
pleasure craft if signaled only on the hour. 

History Note: Statutory Authority G.S. 136-18(5); 
Eff November I. 1991. 

.0428 BRIDGE/US 74/76 0^ ER/INTERCOASTAL WATERWAY/WRIGHTSMI I E BEACH 

The draw shall open on signal, except that from 7:00 a.m. to 7:00 p.m. the draw shall open for pleasure 
craft if signaled only on the hour. 

History Note: Statutory- Authority G.S. 136-18(5); 
Eff November f 1991. 

.0429 BRIDGE SR 1 172 OV ER INTERCOASTAL W.\TERWAY AT SUNSET BEACH 

The draw shall open on signal, except that from 7:00 a.m. to 7:00 p.m. the draw shall open for pleasure 
craft if signaled on the hour from .Aprd 1 to October 31. 

History Note: Statutory Authority G.S. 136-18(5); 
Eff November I, 1991. 

SECTION .0500 - FERRY OPERATIONS 

.0501 GENERAL 

The rules and regulations named herein apply only for the transportation of individual passengers and 
their hand baggage as defined in Rule .0504 of this Subchapter; vehicles under their own power and 
vehicles not under their own power but under tow of a vehicle under its own power, and bicycles. 

History Note: Statutory' Authority G.S. 136-82; I43B-I0(j); 
Eff July I, 1978; ' 
Amended Eff. November 1, 1991 . 

.0503 CARRIER 

WTicn the term "carrier" is used in these rules and regulations, it refers to the North Carolina De- 
:>artment of Transportation; the Division of Highways; and the Ferry Division. 

History Note: Statutory Authority G.S. 136-82; I43B-I0(ji; 
Eff July f 1978; 
Amended Eff November I. 1991. 

.0509 RESPONSIBILITY OF \ ESSEL MASTER 

When in the master's opinion safe landing cannot be made upon arrival of the vessel at a designated 
)ort of destination, it may be landed at another port at which safe landing can be made. 



6:16 NORTH CAROLINA REGISTER Novcmbei 15, 1991 1 192 



FINAL RULES 



Historv S'ote: Statuiorv Authority G.S. 136-82; I43B-I0(j): ■ 

Eff. July I. 1978; 
Amended Eff. November 1 , 1991 . 

05I9 RK.H T TO REFUSE TRANSPORT: CARGO 

Carrier resen.'es the right to refuse any and all articles loaded in or on \'chicles or vehicles which in its 
opinion will jeopardize the safe operation of the vessel, or which earner is not equipped to handle. 
Carrier also reserves the right to refuse to transport vehicles containing offensive or ill-smelling cargo 
and liquid or semi-liquid commodities when not in tightly enclosed containers or tanks, precluding 
possibility of escaping odors or leakage from such \ehicles. Dangerous articles prohibited by law will 
not be transported including those hazardous cargos regulated by the U.S. Coast Guard. 

lEiston' Sote: Statutory Authority G.S. 136-82; I43B-I0(j); 
Eff July /, 1978; 
Amended Eff. November 1 , 1991 . 

.0520 BRAKES 

Drivers of all vehicles should set emergency brakes and engage parking gear on all vehicles having same 
before leaving the \ehiclcs. Drivers of all mechanically powered vehicles shall shut off engines, after 
being directed to their designated parking areas. 

llistoiy Note: Statutory Authority G.S. 136-82; I43B-I0(j); 
Eff July f 1978; 
.{mended Eff November 1 . 1991 . 

.((524 DOGS, AND OTHER HOI SEHOLD PETS AND WILD ANIMALS 

Dogs and household pets may accompany passengers and will be carried on vessels subject to the 
following conditions: 

(1) Dogs, cats, kittens, and small pet birds will be transported without charge when accompanied by 
passengers on foot or in vehicles. Such animals will be transported entirely at risk of owner who 
will be required to take care of and safe-guard them while on vessels or at terminals. 

(2) Such animals must be held secure by leash, crate, cage, or otherwise adequately restrained, as the 
case may require. 

(3) Such animals shall not be pemiitted in passenger accommodations, but only on car deck under 
short leash and in custody of responsible person. Carrier, however, reserves the right to require 
that they be carried in certain places as designated by the master, whenever, in his judgement, such 
a course is necessary for the safety and convenience of the passengers. 

(4) Wild animals must, at all times, be securely crated or caged so as to preclude contact by passen- 
gers. 

Uistoiy Note: Statutoiy Authority G.S. 136-82; I43B-I0(j); 
Eff. July f 1978; ' 
.imended Eff November /, /9';/. 

.0525 NO LLABILITV ASSUMED BY CARRIER 

No hability will be assumed by the carrier in the transportation of household pets, or wild animals. 

Ifistor\> Note: Statulor\- Authority G.S. 136-82; J43B-/0ij); 
Eff July /, 1978; ' 
Amended Eff November I, 1991. 

.0532 TOLL OPERATIONS 

The Cedar Island-Ocracoke, Swan Quarter-Ocracoke and Southport-Ft. Fisher fern.' operations are 

toll operations. I-ares and rates applicable to each operation are as hsted in this Rule: 
(1) Cedar Island-Ocracoke and Swan Quarter-Ocracoke 

(a) pedestrian $ 1.00 

(b) bicycle and nder $ 2.00 

(c) single \'ehicle or combination 20' or less in length $10.00 



ll9i 6:16 NORTH CAROLINA REGISTER November L>, 1991 



FINAL RULES 



(minimum fare for licensed vehicle) 

(d) vehicle or combination from 20' up to and including 40' $20.00 

(e) vehicle or combination up to 65' 

(maximum length) $30.00 

(2) Southport-l't. Fisher 

(a) pedestrian $ 0.50 

(b) bicycle and rider $1.00 

(c) single vehicle or combmation 20' or less in length $ 3.00 
(minimum fare for licensed vehicle) 

(d) \ehicle or combination from 20' up to and including 65' 

(ma.\imum length) $ 6.00 

History Mote: Stalutoty Authority G.S. 136-82: I36-S4: I43B-I0(jj; 
Eff.July I, 1978; 
Amended Eff. Xovember I, 1901: May I. 1 983. 

.0538 \ F.mCIK W KI(;H 1 LIMH A IIONS 

\la.\imum weights permissible for each ferry vessel is as follows: 
Gross Load Limit 
AnyA>de 13,000 lbs. 

2 Axles (Smgle Vehicle) 24.000 lbs. 

3 or More .\xles (Single or 
Combination Vehicles 36,000 lbs. 

Histon Sote: Slatutoty Authority G.S. 136-82: I43B-I0(ji; 
Eff. Julv I. 1 97. 3; 
Amended Eff. Xovember /, /99/. 

.0539 MHICI.K PHYSICAL DLMENSION LIMLI ATIONS 

(a) Maximum ph\ sical dimensions for %'ehicles on each feny vessel are as follows: 
Vessel length Width Height 

Lindsa\ Warren 65' 144" 13'6" 

Conrad Wirth 65' 144" 13'6" 

Roanoke 65' 144" 13'6" 

R. B. 1 thendge 65' 144" 13'6" 

A. W. Dnnkwater 65' 144" 13'6" 

II. C.Bonner 65' 144" 13'6" 

SUver Lake 65' 120" 13'6" 

Pamlico 65' 120" 13'6" 

Sea I evel 65' 96" 13'6" 

Gov. Ldward Hvde 65' 96" 13'6" 

50' (Side) 120" 13'6" 

Beaufort 50' 96" 12'4" 

Sandy (}raham 55' 96" 13'6" 

Gov. Cherr>- 55' 96" 13'6" 

I'.mmett Wuislow 50' 96" I3'6" 

Ocracoke 65' 144" 13'6" 

Cape Point 65' 144" 13'6" 

Chicamacomico 65' 144" 13'6" 

Kmiiakeet 65' 144" 13'6" 

Insco 65' 144" 13'6" 

Ciovemor Russell 65' 144" 13'6" 
Governor James 

Ba.xter Hunt, Jr. 65' 144" I3'6" 

Carteret 55' 120" 13'6" 

(b) All vehicles ha\ing o\erall dimensions iji excess of established size restrictions (1 ength: single two 
xle vehicle, 35 feet; smale three axle veliicle, 40 feet; vehicle combination, 60 feet Width: '^6 inches 



6:16 NORTH CAROLINA REGISTER November I.\ 1 99 1 1194 



FINAL RULES 



Height: 13 feet 6 inches) shall earn' a special permit issued by the division of highways; otherwise, 
loading aboard a ferry \essel will not be permitted. 

Histon- Sote: Staluion Authoritv G.S. 20-119; 136-82; I43B-I0(j): 
Eff.July I. 1978; ' 
Amended Eff. Xovember I. 19') I . 

SKC HON .((600 - TECHNICAL SERMCKS 

.((601 PERMITS-Al THORH V, APPEICATION AND ENEORC EMEN T 

(a) The aulhonty to issue permits tor movement of \ehicle(s) with or without load is delegated to the 
State Highway Administrator. The Administrator has further delegated this authority to the Mead of 
the Maintenance Unit, and under limited conditions, to di\ision and district engineers. Division and 
district offices shall not issue permits for travel outside their respective area without approval of other 
involved divisions or districts or the Central Permit Office. The State Highway Administrator may 
alter, delete or add to these regulations upon his determination that the best interest of the Division of 
Highways or the traveling public will be served. 

Irrespective of the route shown on the permit, an alternate route will be followed: 

( 1 ) if directed by a peace officer; 

(2) if directed by an official traffic control device to follow a route to a weighing device; 

(3) if the specified route on which the permittee is traveling is otficialK' detoured, the driver shall 
contact the issuing pennit office prior to proceeding: 

(b) Application for permits shall be made on forms appro\"ed by the Head of .Maintenance Unit or 
by telephone, wire ser\ice or written request. Application for permits requiring an engineering studv 
or other special conditions or considerations will be approved by the Head of .\laintcnance Unit and 
must be submitted at least ten working days prior to the anticipated date of move. A surety bond may 
be required for permits issued in excess of 122,000 lbs. gross vehicle weight to be determined b> the 
Head of Maintenance in conjunction with the division engineer. 

(c) Permits ma\ be declared void by the State fhgliway Administrator, Head of .Maintenance Unit 
or the Central Pennit OtTice upon determination that such overdimension, overweight pennit was being 
used in v iolation of the General Statutes of North Carolina, Pennit Policy or restrictions stated on the 
permit. 

(d) Pemiits ma\ also be denied, revoked or declared invalid as stated in Rule .0633 of tliis Section. 

Uisiorv Sote: Statutory Authority G.S. 20-//8ifi; 20-119; /J6-JSi5j; 
Eff. July 1. /9~8; 
.'{'mended Eff. October 1. 1991. 

.0602 PER.MEES-ISSUANf E AND EEES 

(a) Permits mav be issued or movements of loads which cannot be reasonably divided, dismantled 
or disassembled, or so loaded to meet legal requirements. Permits iu"e issued on authon/ed forms with 
appropnate designation for qualifying mo\'es. To be valid, a pennit must be signed by the permittee 
and carried in the towing unit while permitted load is m transit. A permit issued by the Department 
is not vahd for travel over municipal streets (Defined as streets or highways not maintained b\ the State 
of North Carolina). Permitted \ehicles wiU not travel in convoy. 

(1) Single trip permits may include a return trip to origin if requested at the time of original issuance 
and the return tnp can be made within the validation of such permit. No single tnp pennit re- 
quest will be issued for a time penod to exceed 30 days. 

(2) .Annual permits (blanket) are valid 12 months from the date of issuance. Thev mav be issued 
for: 

(A) Permitted loads up to 10' wide authorizmg travel on all roads; 

(B) Up to but not to exceed a width of a 12' authorizing travel on North Carolina, interstate and 
US highvva\'s. Provided, mobile, modular homes not to exceed a width of a 14' unit with an 
allowable root overhang not to exceed 12" mav' also be authorized to travel on designated North 
Carolina, Interstate and US highways. 

(3) City Passenger Buses which exceed the weight limits in (jS 20-1 lS(f| may be issued permits tor 
operation on the highways of the state in the \'icinity of the municipality and to quality the ve 
hide for license. 



1195 6:16 NORTH CAROLINA REGISTER November L\ 1991 



FINAL RULES 



(b) A fee will be collected as specified in GS 20-1 19(b). Only cash, certified check, money order or 
company check will be accepted. No personal checks will be accepted, ['ermittees with established 
credit accounts will be billed monthly for permits issued for the previous month. 

AH fees collected are to be processed in accordance with DOT Field Policy Procedure Manual, 
Chapter 6, Section 22. Provided, the following exemptions of fees shall apply to permits issued: 

(1) I- or house moves; 

(2) For movement of farm equipment by the farmer for agricultural purposes; 

(3) To any agency of the Umted State Government; 

(4) The State of North Carolina or its agencies, institutions, or municipalities, provided the 
vehicle/vehicle combination is registered in the name of such go\emmcnt body. 

Histon \oie: Statuton- Authohtv G.S. 20-1 19: 136-18(5): 
Eff.July I. 1978: ' 
Amended Eff. October I, 1991: April I. 1984: April II, 1980. 

.0603 ISSUING OFFICES AND PROCEDURES 

.0604 APPLICATIONS FOR A PERMIT 

.0605 PERMITS 

.0606 LEGAL WTIGFITS AND DIMENSIONS 

Histoiy Note: Sraiulorv Authority G.S. 20-116: 20-118: 20-119; 136-18(5); 
Eff. July I. 1978; 

Amended Eff. October I, 1990: September I. 1990: 
April I. 1984; April II. 1980; 
Repealed Eff October 1. 1991. 

.0607 PERMITSA\TIGHT, DIMENSIONS AND LIMITATIONS 

(a) Width is limited to 15' for all movements except certain construction machinery, buildings, 
stnictures, manufacturing machinerv' for moves authorized by the Central Permit OtTice. If blades of 
bulldozers, graders or front end loader buckets cannot be angled to extend no more than 12' across the 
roadway, they must be removed. ,\ blade or bucket or other attachment which has been removed for 

afety reasons, or if in the best interests to the Department has been removed, may be moved with the 
:quipmcnt without being considered a di\'isible load. Moves exceeding 12' for a commodity essential 
to national health, safety or defense may be pennitted upon receipt of proof of necessity submitted by 
the agency directly concerned, however, if considered to be detrimental or unsafe to the other traveling 
:iublic or if the highway cannot accommodate the move due to width or weight, such move will be 
lenicd. Loads must be so placed on \ehicle vehicle combination so as to present least over dimension 

o traffic. 

(b) The maximum weight permitted on a designated route is determined by the bridge capacity of 
bridges to be crossed during movement. A surety bond may he required to co\er the cost of damage 
o pavement, bridges or other damages incurred dunng the pemiitted move. 

(1) The maximum single trip and annual pemiit weight allowed for \chicle or vehicle combinations 
not to include off highwav construction equipment without an engineering studv is; 
Single axle " ' 25.000 lbs. 

2 axle tandem 50,000 lbs. 

3 or more axle group 60,000 lbs. 

3 axle vehicle 60.000 lbs. 

4 axle vehicle 75,000 lbs. 

5 axle vehicle 94,500 lbs. 

6 axle vehicle 103,000 lbs. 

7 or more axle vehicle 122,000 lbs. 
^2) The maximum pemiit weight allowed for off highway construction equipment is: 

(A) Self-propelled scrapers with low pressure tires: 
Single a.xle 37,000 lbs. 

2 axle vehicle 55,000 lbs. 

3 axle vehicle 70,000 lbs. 

4 axle vehicle 90.000 lbs. 

(B) Self-propelled truck cranes with counterweights and boom remo\ed (if practical): 
3 axles - not to exceed 25,000 lbs. per a.xle maximum gross 



6:16 NORTH CAROLL\'A REGISTER November 15. 1991 1196 



FINAL RULES 



weight 70,000 lbs. 

4 axles - not to exceed 25.000 lbs. per a.xle maximum eross 

weight " 78,000 lbs. 

5 a.xles - w heel base less than 244 inches: 

front 2 axles 35,000 lbs. 

rear 3 axles 56.500 lbs. 

Gross Q 1.500 lbs. 

5 axles - u heel base more than 244 inches: 

front 2 axles 37,500 lbs. 

rear 3 axles 57.000 lbs. 

Gross 94,500 lbs. 

6 axles - w heel base more than 2^6 inches: 

2 axle tandem 50.000 lbs. 

3 axle group 57,000 lbs. 
Gross " 103,000 lbs. 

* 7 axles - extreme wheel base of 44 feet: 

2 a.xle tandem 40,000 lbs. 

3 axle group 57,000 lbs. 

4 axle group 71.000 lbs. 
Gross 122,000 lbs, 

*Se\en axle equipment subject to indi\idual review for appro\'al. Speed restricted to 45 m.p.h. 
(3) Sealed Ship Containers: 

(A) Going to or from a designated seaport (to include in state and our of state) and has been or 
will be transported by manne shipment: 

(B) Licensed for maximum alkn\'able weight allowed in G.S. 20-1 18; 

(C) \'ehiclc \'ehicle combination has at least five axles: 

(D) To ha\c proper documentation (shippers bUl of laden and or trucking bdl of laden) of sealed 
commodity being transported a\ailable for enforcement inspection. 

The Department of Transportation shall issue a permit for 80,000 lbs. but not to exceed 94,500 lbs. 
w ith up to ten designated routes of prennttcd tra\cl provided all qualifying requirements have been 
met. 

(c) 0\erlength permits will be limited as follows: 

(1) Single trip permits are limited to S5 to include towing vehicle. Approval may be gisen by the 
Central Pcnnit Office for pcnnitted loads in excess of S5' after review of route of travel. Pro- 
\ided. mobde modular homes may be issued permits not to e.xceed 95 . 

(2) .Annual (blanket) permits wdl not be issued for lengths to exceed 65'. Front o\erhang may not 
exceed 3' unless if transported otherwise would create a safety hazard, Fro\ided, 
mobile modular home pennits may be issued for a length not to e.xceed 91', 

(d) There are not set hiiiits for pemiilted height as it is controlled by clearances on designated route. 
Permit wiU indicate "Check Height on Structures". The issuance of the permit does not imply nor 
guarantee the clearance for the permitted load and all vertical clearances should be checked b\' the 
permittee prior to mo\'emcnt underneath. 

(e) Time of move is to be made between sunrise and sunset Monda\' through Saturday with no move 
to be made on Sunday or appro\ed state hoUdays. Contmuous tra\el would be authorized for any 
vehicle \ehicle combination up to but not to exceed 94,500 lbs., pro\ided: 

(1) no other over legal dimension is to be included in the permitted mo\'e. and 

(2) the \ehicle is hcensed for the maximum allowable weight determined by extreme axle measure- 
ments. If the holiday falls on Sunday, the follow ing .\Ionda\' will be considered the hohdays. 
Time restrictions may be determined b\' the issuing otTice it" in the best interest for safety and or 
to expedite trattic. Provided, mobile modular homes are restricted to travel .Monday through 
12 noon on Saturday, 

(f) The speed of pennitted mo\es shall be that which reasonable and prudent for the load, considering 
weight and bulk, under conditions existing at the time: however, the maximum speed shall not exceed 
the posted speed Umit. The dri\er will maintain a speed consistent with maintaining proper interval 
and temporarily relinquishing the traffic way to allow the passage of following vehicles when a build 
up of traffic occurs. Pro\ided, se\en a.xle self-propelled truck cranes with extreme wheel base of 44 feet 
shall not exceed a maximum speed of 45 mph. 

(g) .Additional safety measures will be required as follows: 



7/9" 6:16 NORTH CAROLINA REGISTER November L\ 1 99 1 



FINAL RULES 



(1) A >elIow (or a color of equal effectiveness) banner measuring 7' x 18" bearing the legend 
"Oversize Load" in 10" black letters will be displayed on the towing unit for all loads in excess 
of 10' wide; 

(2) Red flags measuring 18" square will be displayed on all sides at the widest point of load for all 
loads in excess of 10' wide but the flags shall be so mounted as to not increase the overall width 
of the load; 

(3) A flagman may be required for \'ehicle/vehicle combinations of loads in excess of 12' in width 
when a speed of 20 miles per hour cannot be niaint:iined on level terrain. 

(4) Rear view mirrors and other safety devices on towing units attached for movement of overwidth 
loads shall be remo\'ed or retracted to conform u ith legal width when unit is not towing/hauling 
such vehicle or load; 

(5) Mashing amber lights will be used as determined by the issuing permit otTice. 

(h) The object to be transported will not be loaded or parked, day or night, on the highway right of 
way without specific permission from the office issuing the permit. 

(i) No move will be made when weather conditions render \isibility less than 500' for a person or 
vehicle. .Moves will not be made when highway is covered with snow or ice or at any time travel 
conditions are considered unsafe by the Division of Highways, State Highway Patrol or other 1 aw 
I'nforcement Officers having jurisdiction. Movement of a mobile modular 14' unit with an allowable 
roof overhang not to exceed 12" will be prohibited when wind velocities exceed 25 miles per hour in 
gusts. 

(j) All obstructions, including traffic signals, signs, utility lines will be remo\'ed immediately prior to 
and replaced immediately alter the mo\e at the expense of the mover, pro\ ided arrangements for and 
appro\al from the owner is obtained. In no e\ent are trees, shrubs, or olticial signs to be cut, trimmed 
or removed without personal appro\aI from the district engineer having jurisdiction o\er the area in- 
volved. 

(k) Reciuirement for escort \ehicles(s) will be detennined by the issuing office and'or the Central 
Permit Office. 

History Sole: Authority G.S. 20-119: I36-IS(5): Board of 
Transportation Minutes for Febnuvy 16, 1977 
and November 10. 19'^S: 
Eff. July I. I97S; 

Amended Eff. October I. 1991: October I, 1990; 
September I. 1090: Januaiy I. J9S5. 

.0608 LKNGIH 

.0609 iiKi(;nr 

.0610 WKK.HI 
.061! TIM K LIMIT 

llisloty Note: Statutory Authority G.S. 20-116; 20-119; 136-18(5): 
Board of Transportation Minutes for Febniaiy 16, 1977 
and November 10, 1978; 
Eff. July /, 1978; 

Amended Eff. September I. 1990; October I. 1987; 
April I. 1984; Februaiy I, 1983; April If 1980; 
November /. 1978: 
Repealed Eff October f 1991. 

.0612 PKRMITS - HOUSE MOVES 

(a) Application for a pcmiit will be made by a licensed housemover for moves in excess of 15' to the 
appropriate district or division office in which the house is to be mo\'ed or in conjunction with other 
districts or divisions included in the proposed move. 

(b) Provided, an exemption shall not require an indi\idua] to acquire a housemover license prior to 
applying for a permit if the building is owned by the [^cnnittec and such move is to or from property 
owned individually by the pennittce. 

(c) Conditions and hmitation on building move pennits will be determined by the division or district 
engineers and/or the Central Permit Office. The permittee assumes all responsibility for injury to per- 
sons or damage to property of any kind. See 19.\ NC.AC 2D .0618. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 119S 



FISAL RULES 



(J) Stale Higliua\' Patrol or other Law linforcement personnel ha\ing jurisdiction will be notified 
ot the anticipated date and time of move for "House" widths exceeding 15'. 

Hision- Sole: Staiutory Authority G.S. 20-119: 136-18(5); 
Session Laws Ch. 720, s.3i 1977); 
Eff. July /, I9-'S: 
Amended Eff. October 1. 1991; April I. I9S4; January /, 1979. 

.0613 riME .AM) SAI KI V RKQIIREMKMS - BUILDING .MOA ES 
.0614 .SIZE AND WEIGH I - HI II.DING MOVES 
.0615 ESUMAIE OE (;R()SS W EIGHI - BEII.DINGS 

lliston Sole: Statutory Authority G.S. 20-119: 136-18(5); 
Eff. Juh- I, 1978; 
Amended Eff. April IL 1980; 
Repealed Eff. October 1. 1991. 

.061" REM()\ AE OE OBSTRICTIONS - BEIl DING MOVES 

I/istony .\ote: Statutory Authority G.S. 20-119: 136-18(5); 
Eff. July 1. 19~8; ' 
Amended Eff .April 11. 1980; 
Repealed Eff October 1. 199 1. 

.0619 IIMIl ATIONS - Bl IIDING MO\ ES 

.0620 REQl IRING OE ES( OR 1 \ EHICEE 

.0621 POSH ION OE ESCORT \ EHICEES 

.0622 ES( OR 1 OE N EHK IE REQIIREMEN IS 

.(1623 SEOW SPEED: ESCORT 

.062-t 1 IME OF MO\ E 

.0625 SPEED I IMIIS 

.0626 SIGNS: EEAGS 

.0627 SI A IE IlIGinX AY PA IROE NOTIEICAIION 

Uistoiy Sate: Statutory .Authority G.S. 20-119; 136-18(5 !; 

Board of Transportation Minutes for Febnuvy 16, 1977 

and Sox ember 10, I9~8; 

Eff July 1. 19"8: 

.-{mended Eff October 1. 1990: September 1. 1990: 

January 1. 'l985: July 1. 1981: April II, 1980; 

Januar: 1 . 19^9; 

Repealed Eff October 1, 1991. 

.0629 rOWING INIT 

.0630 ROl IE ( HANGES 

.0631 IIIGIIW AY RIGHT OE WAY RESTRIC IIONS 

.0632 WEAIHER 

HisiofT .\ote: Statutory .Authority G.S. 20-1 19; 136-18(5); 
Eff July I, 197S; ' 

Amended Eff October 1. 1990; April 11. 1980; 
Repealed Eff October 1, 1991. 

.0633 DENIAL: RE\ OCATION: REEUSAL TO RENEW: APPEAL: IN^ Al IDATION 

(a) A permit may be denied for a period of up to six months upon written llnding that the applicant 
violated, while in possession of a pre\"iousl\ issued permit, any of the rules contained in this Section, 
the Special Permit .Manual, or state and local laws and ordinances regulating the operation of ovcr- 
weisht or oversb.ed vehicles. 



1199 6:16 SORTH CAROLISA REGISTER Sovember 15. 1991 



FINAL RULES 



(b) A permit may be revoked upon written findings that the permittee violated the terms and condi- 
tions of the permit, which shall incorporate by reference these Rules, the rules in the Special Permit 
Manual, as well as state and local laws and ordinances regulating the operation of overweight or over- 
sized vehicles. Repeated \iolations may result in a permanent denial of the right to use the N.C. State 
Highway System of roads for transportation of overweight and or overdimension vehicle/ vehicle com- 
binations or vehicle, vehicle combination and load. A permit may also be revoked for misrepresentation 
of the information on the application, fraudulently obtaining a permit, alteration of a permit, or un- 
authorized use of a permit. 

(c) No permit shall be denied or revoked, or renewal refused, until a written notice of the denial or 
\iolation of the issued permit has been furnished to the applicant. The permittee may appeal in wnting 
to the State Highway Administrator or his designee within 10 days of receipt of wntten notification of 
denial or revocation. The State Highway Administrator or his designee must give at least 10 days 
written notice of the time and place of the hearing to the applicant by personal service or certified mail, 
return receipt requested. A written decision by the State Highway Administrator or his designee must 
he within 10 days from the date of the hearing to the applicant. Upon revocation of the permit, it must 
he surrendered without consideration refund of fees and a new permit obtained prior to mo\emcnt of 
the overdimension and or over weight vehicle upon restoration of permit privileges. 

(d) Permits vviU be invalid if the vehicle or vehicle combination is found by a law enforcement officer 
to be operating in violation of permit conditions regarding route, time of movement, ficensing, number 
of axles or any other special condition of the permit. The penalties under G.S. 20-1 18 and G.S. 20-1 19 
apply in such situations. Provided, when the dri\er of a permitted vehicle is faced with a bona fide, 
\L'nfiable emergency requiring that the \ehicle be operated temporarilx off route or off route due to 
\L'rifiable and unintentional error of the dri\er, the permit will not be valid. The owner of the vehicle 
must either obtain a corrected permit from point of inspection to destination or the vehicles may be 
escorted back to the permitted route. 

llbiory Sote: Statulon Authority G.S. 20-119: 20-360; 20-361: 

20-367: 20-369: 20-371: l36-IS(5i: I43B-346: l43B-350(f); 

Eff. July I, 1978; 

.{mended Eff. October I. 1991: .4pn/ /, /9.S4: .Ipril II, I9S0. 

.(»634 DKLi:(;AriON 

.0635 COORDINATION OF .MO\ K.MKNT 

.0636 SPKCIAL CONDIIIONS 

.0637 SPECIAL PERMII LIMITATIONS 

.0638 L7SLSLAL CIRCUMSTANCES 

History Sote; Statutory- .-luthority G.S. 20-119; 136-14.1; 136-18(5); 
Eff.Julvl. 1978; 

Amended Eff. December I. 1990; .Ipril I, 1984; 
November 1. J 9^8; 
Repealed Eff. October I, 1991. 

.0639 SPECIAL PERMITS I OR PASSENGER Bl SES 

Ifiston- Note; Statutory' Authority G.S. 20-1 IS(8J; 
Eff September I, 1978; 
Repealed Eff October I. 1991. 

.0641 PERMIT EEES 

lfislor\' Note; Statuto/y Authority G.S. 20-119; 136-18(5): 
l43B-359(f)(l3): 12-3.1; 
Eff April I. 1984; 
Repealed Eff October I. 1991. 

SECTION .0800- PREQUALIFICA HON: AD\ ERTISING 
AND BIDDING RE(,ULA LIONS 



6:16 NORTH CAROLINA REGISTER November 15, 1 99 1 1200 



FINAL RULES 



.(1801 PRKQLALIFVING lO BID: RKQl ALIFICATION 

(a) F'rospecti\e bidders shall prequalify with the Department. The requirements for prequalification 
will be furnished each prospecti\e bidder by the Manager of Construction, Division of Highways, De- 
partment of Transportation, Raleigh. N, C. 27611 upon receipt of a written request. All required 
statements and documents shall be filed with the Manager of Construction by the prospective bidder 
at least two weeks prior to the date of opening of bids. A bid will not be opened unless all prequali- 
fication requirements ha\"e been met by the bidder and have been found to be acceptable by the Chief 
Engineer. 

(b) Bidders shall comply with all applicable laws regulating the practice of general contracting as 
contained in Chapter S7 of the General Statutes of North Carolina. 

(c) All bidders must requaliiV annually. To requalify, the prospective bidder must submit a com- 
pleted E.xperience Questionnaire Form, acceptable to the Manager of Construction, on or before the 
anrLi\"ersan, date of the original prequalification. Experience Questionnaire Forms wiU be furnished 
appro.ximately 30 days prior to the anniversan,' date and must be completed and executed in the same 
manner as the original form. 

(d) After re\icuing the Experience Questionnaire, and the List of a\ailable equipment, the Manager 
of Construction uill notify the prospective bidder in writing of the response to his request for pre- 
quahfication. 

(ej The Experience Questionnaire is a form showing the work experience record of the prospective 
bidder. Copies of this form may be obtained from the Manager of Construction, Di\"ision of llighwa\s, 
Raleigh, N, C, 2761 1 or the Assistant Secretar,' for .Management at no cost, 

Histoiy Sole: Statmon Authority G.S. 136-IS( I j; I36-2S.I: 
1 36-44. f; 136-45: 'l 43-350 ffj: 
EJ]'. April 3, I9SI; 
Amended Eff. Xovember 1 . 1991 . 

.0803 AD\ FRTISF.MENT AND INATT.ATIONS FOR BIDS 

(a) All projects in each monthly bid opening will normally be ad\ertised in three widely circulated 
daily newspapers throughout the state four weeks prior to the bid opening. Projects may be ad\ertised 
for shorter or longer periods of time as determined by the State Highway .Vdministrator, 

(b) .An invitation to bid for monthly bid opening will be mailed to those contracting firms, material 
suppliers and other interested parties who have requested they be placed on the invitation to bid mailing 
hst, This in\ itation to bid will normally be mailed out on the day the four-week ad\ertisement appears 
in the new spapers. If projects are later added to the letting, or if a special bid opening is set up and the 
projects are ad\ertised for a two or three-week period, an invitation to bid on these projects will be 
mailed to those contracting firms on the mailmg list. 

Histoiy Sole: Statutory- Authority G.S. I36-2S.I ; 
Eff. April 3, 1 9S I:' 
.■intended Eff Xovember 1 . 1991 . 

.0808 PREPARATION AND SI EMISSION OF BIDS 

.VU bids shall be prepared and submitted m accordance with the following listed requirements: 

(1) The proposal form furnished by the department shall be used and shall not be taken apart or 
altered. The bid shall be submitted on the same proposal form which has been furnished to the 
bidder by the department as identified by the bidder's name marked on the front cover by the de- 
partment. 

(2) .Ail entries including signatures shall be written in ink, 

(3) The bidder shall submit a unit or lump-sum price for ever\" item in the proposal form other than 
items which are authorized alternates to those items for which a bid price has been submitted, 
.As an exception to this Rule, when the proposal form permits a bidder to submit a bid on only a 
portion of the work covered b\' the entire proposal form, the bidder sh;ill then submit a unit or 
lump-sum price for e\'ery item constituting that portion of the work on which the bidder has 
elected to place a bid other than items wliich are authorized alternates to those items for which a 
bid price has been submitted. The unit or lump-sum prices bid for the various contract items shall 
be written in figures. The unit prices shall be rounded off by the bidder to contain no more than 
four decimal places. 



1201 6:16 XORTH CAROLINA REGISTER .Xovember 15, 1 99 1 



FINAL RULES 



(4) An amount bid shall be entered in the proposal form for e\er> item on which a unit price has 
been submitted. The amount bid for each item other than lump-sum items shall be determined 
by multiplying each unit bid price by the quantity for that item, and shall be written in figures in 
the ''Amount Bid" column in the proposal form. In the case of lump sum items, the price shall 
be written in figures in the "Amount Bid" column in the proposal form. 

(5) 1 he total amount bid shall be written in figures in the proper place in the proposal form. The 
total amount bid shall be detemiined by adding the amounts bid for each item. 

(6) Changes in any entr\ shall be made by marking through the entr} in ink and making the correct 
entry adjacent thereto in ink. A representative of the bidder shall initial the change in ink. 

(7) The bid shall be properly executed. In order to constitute proper execution, the bid shall be 
executed in strict compliance with the following: 

(a) If a bid is by an individual, it shall show the name of the indi\idual and shall be signed b\ the 
individual with the word " Individually" appearing under the signature. If the mdividual operates 
under a firm name, the bid shall be signed in the name of the individual domg business under 
the firm name. 

(b) If the bid is by a corporation, it shall be executed in the name of the corporation by the presi- 
dent, vice president, or assistant vice president. It shall be attested by the Secretar> or assistant 
secretarv'. The seal of the corporation shall be affi.xed. If the bid is executed on behalf of a 
corporation in any other manner than as above, a certilied copy of the minutes of the board of 
directors of said corporation authorizing the manner and style of execution and the authority 
of the person executing shall be attached to the bid or shall be on file with the department. 

(c) If the bid is made by a partnership, it shall be executed in the name of the partnership by one 
of the partners. 

(d) If the bid is a joint \enture, it shall be executed by each of the joint venturers in the appropriate 
manner set out in this Rule. In addition, the execution by the joint venturers shall appear below 
their names. 

(e) The bid execution shall be notarized by a notary public whose commission is in effect on the 
date of execution. Such notan/ation shall be applicable both to the bid and to the non-collusion 
affidavit \\ hich is part of the signature sheets. 

(8) The bid shall not contain an> unauthorized additions, deletions, or conditional bids. 

(9) The bidder shall not add any provision reserving the right to accept or reject an award, or to enter 
into a contract pursuant to an award. 

(10) The bid shall be accompanied by a bid bond on the fomi furnished by the department or by a 
bid deposit. The bid bond shall be completely and properly executed in accordance with the re- 
quirements of Rule .0809 of this Section. The bid deposit shall be a certified check or cashiers 
check in accordance with Rule .0809 of this Sectitin. 

(11) The bid shall be placed in a sealed envelope and shall ha\e been delivered to and received b\ the 
department prior to the time specified in the invitation to bid. 

(12) The bid shall not be an imbalanced bid. 

Iliston' \ote: Slatulorv Aiilhorilv Cr.S. I36-IS( I ): 
Eff. Aprils. 1981;' 
Amended Eff. Sovemhcr I. 1901; July I. 19S2. 

0809 BID BOND OR BID DKPOSIl 

(a) Each bid shall be accompanied by a corporate bid bond or a bid deposit of a certified or cashiers 
.heck in the amount of at least five percent of the total amount bid for the contract. No bid will be 
.'onsidered or accepted unless accompanied by one of the foregoing securities. The bid bond shall be 
:xecuted b\' a corporate surety licensed to do business in North Carolina and the certified check or 
:ashiers check shall be drawn on a bank or trust company insured by the Federal Deposit Insurance 
'orporation and made pa\able to the Department of Transportation in an amount of at least fi\e 
■>ercent of the total amount bid ti)r the contract. 

;■)) The condition of the bid bond or bid deposit is: the principal shall not withdraw its bid within 
)0 days after the opening of the same, and if the Board of Transportation shall award a contract to the 
■"rincipal, the principal shall within 10 days after the notice of award is received by him, gi\'e payment 
nJ perlormance bonds with good and sufficient surety as required for the faithful performance of the 
ontract and the protection of all persons supplying labor and materials in the prosecution of the work; 
n the event of the failure of the principal to give such payment and performance bond such contract 
nd execute such documents as required then the amount of the bid bond shall be immediately paid 



6:16 NORTH CAROLINA REGISTER November I \ 1991 1202 



FINAL RULES 



to the nepartment as liquidated damages or, in the case of a bid deposit, the deposit shall be forfeited 
to the Department. 

(c) Withdrawal of a bid due to a mistake made in the preparation of the bid, where permitted by Rule 
.0819 of this Section shall not constitute withdrawal of a bid as cause for payment of the bid bond or 
forfeiture of the bid deposit. 

(d) When a bid is secured b\' a bid bond, the bid bond shall be on the form furnished by the De- 
partment. The bid bond shall be executed by both the bidder and a corporate surety licensed under 
the laws of North Carolina to wnte such bonds. The execution b) the bidder shall be in the same 
manner as required by Rule .0808 of this Section for the proper execution of the bid. 'Ihe execution 
by the corporate surety shall be the same as is provided for by Rule .I)8n8(7)(n) of this Section for the 
execution of the bid b\ a corporation. The seal of the corporate surety shall be affi.xcd to the bid bond. 

I he bid bond form furnished is for execution of the corporate suret\ by a Cjeneral Agent or Attorney 
in bact. A certified copy of the Power of Attorney shall be attached it the bid bond is executed by a 
General Agent or Attorney in 1 act. The Power of Attorney shall contain a certification that the Power 
of Attorney is still in full force and etfect as of the date of the execution of the bid bond by the general 
agent or Attorney in Fact. If the bid bond is executed by the corporate surety by the President, Vice 
['resident, or .Assistant \'ice President and attested to by the Secretary' or Assistant Secretar)', then the 
bid bond form furnished shall be modit'ied for such execution, instead of execution b\' the Attorney in 
bact or the General Agent. 

(e) When a bid is secured by a bid deposit (certified check or cashiers check), the execution of a bid 
bond wlU not be required. 

(f) If the bidder has failed to meet all conditions of the bid bond but the Department has not received 
the amount due under the bid bond, the Bidder may be disqualified trom turther bidding as pro\idcd 
in Rule .0816 of this Section. 

Hislory \ote: Statuton Authoniv G.S. I36-IS( I ); 
F.ff. April 3, I^SI:' 
Amended Eff. November 1. 1991. 

.0810 i)klim:ry of bids 

(a) /VU bids shall be placed in a sealed en\'elope ha\ing the name and address of the bidder, and the 

statement "Bid for the Construction of State Higliway Project No. ui County 

(Counties)" on the outside of the envelope. 

(b) If dehvered in person, the scaled envelopes shall be delivered to the office of the Contract Officer 
as indicated in the in\itation to Bid, except that if it is deU\ered in person on the day on which bids 
are to be opened, it shall be delivered to the place indicated in the in\itation to bid. If delivered by 
mad, the scaled en\elope shall be placed in another sealed en\elope ;uid the outer en\eIopc addressed 
to the Contract Officer, Division of IIighwa\s, North Carolina Department of Fransportation, Raleigli, 
N. C. 27611. Ihe outer envelope shall also bear the statement "Bid for the Construction of State 
Highwa)' Project No. ." 

(c) All bids shall be delivered prior to the time specified in the invitation to bid. All bids received 
after such time wiU not be accepted and will be returned to the bidder unopened. 

Ifistofy \ote: Filed as a Temporaiy Amendment Fff. Match IS. I9S2. 
for a Period of 4^ Days to Expire on Afay /. I9S2: 
Statutory Authoritv G.S. I36-IS(1 ): 
Eff. April 3, 1981: 
Amended Eff \ovember I. 1091: Jidy I. I9S2: May /, I9S2. 

.081 1 W I IIIDRAWAL OR RHMSION OF BIDS 

A bidder may, without prejudice to himself, withdraw a bid ;dter it has been delivered to the Depart- 
ment, pro\"ided the request for such withdrawal is made either in unting or by telegram to the Chief 
Fngincer-Operations or the engineer presiding o\er the public opening of bids before the date and time 
set for the opening of bids. Fhe bidder may then submit a re\ised bid pro\idcd it is received prior to 
the time set for opening of bids. 

Only those persons authorized to sign bids under the pro\isions of Rule .0808(7) of this Section shall 
be recognized as being qualified to withdraw a bid. 

Withdrawal of a bid after the date and time set for the opening of bids will be permitted only in ac- 
cordance with Rule .0819 of this Section. 



I20i 6:16 NORTH CAROLINA REGISTER November L\ 1991 



FINAL RULES 



History Sole: Statulon Aulhoritv G.S. I36-IS( I j; 
Eff. Aprils. I9HI:' 
Amended Eff. Xovcmber /, /</)/. 

.0813 W n HDRAW OF BIDS - MISIAKE 

(a) Criteria for Withdrawal of Bid: 1 he Department of Transportation may allow a bidder submitting 
a bid pursuant to Ci.S. 136-28.1 for construction or repair work to withdraw his bid after the scheduled 
time of bid opening upon a determination that: 

(1) a mistake was in fact made in the preparation of the bid; 

(2) the mistake in the bid is of a clerical or mathematical nature and not one of bad judgment, care- 
lessness in inspecting the work site, or in reading the plans and specifications; 

(3) the mistake is found to be made in good faith and was not deliberate or by reason of gross 
negligence; 

(4) the amount of the error or mistake is equal to or tjeater than three percent of the total amiiunt 
bid; 

(5) the notice of his mistake and request for withdrawal of the bid by reason of the mistake was 
promptly communicated to the Chief bngineer and in no mstance longer than 4S hours alter the 
scheduled time of bid opening. If the Bidder notifies the Chief lingineer \erball\ , written notice 
of mistake must be submitted within 48 hours to the Chief Engineer accompanied b\ copies of 
bid preparation information. 

(6) the [department of 1 ransportation will not be prejudiced or damatzed except for the loss o( the 
bid. 

(b) Hearing by Chief [-ngineer: If a bidder files a notice of mistake along with a request to withdraw 
his bid. the Chief Hngineer (or his designee) u ill promptly hold a hearing thereon. The Chief Lngineer 
will gi\ e to the requesting bidder reasonable notice of the time and place of any such heaiing. I'he 
bidder may appear at the hearing and present the original working papers, documents or materials used 
n the preparation of the bid sought to be withdrawn, together with other facts and arguments in sup- 
port of his request to withdraw his bid. The bidder \\ iU be required to present a written aftidax it that 
the documents presented are the original, unalterei.1 documents used in the preparation of the bid. 

(c) .\clion by State Highway /Xdministrator: A determination may be made by the administrator that 
the bidder meets the criteria for withdrawal of the bid as set forth in Rule .081*^) of this Section upon 
presentation of clear and consincing evidence by the bidder. The (liief lngineer will present his 
findings to the State Ilighwax .\dministrator for action on the bidder's request. The Chief I ngineer 
will advise the Bidder of the .Administrator's decision pnor to the Board of Transportation's consider- 
ition of award. 

(d) Bid Bond: If a bid mistake is made and a request to withdraw the bid is made, the bid bond shall 
continue in full force and effect until there is a determination by the .Administrator that the conditions 
m Rule .()81<)(a) of this Section ha\e been met. The effect of the refusal of the contractor to gi\e 
payment and performance biinds within ten days after the notice of award is received by him, if award 
has been made by the Board of Transportation after consideration and denial of the contractor's request 
to withdraw his bid, shall be governed by the terms and conditions of the bid bond. 

llistofy \(>te: Statutory Authority G.S. 136-ISi I ): l43B-3S0ifi: 
Eff. May I. I9S4: ' 
Amended Eff. Sovemher /. I9')L 

.0814 ( ORRKC HON OF BID FRRORS 

Id) (jcneral: The provisions of this Rule shall ciimply in waiving irregularities and correcting ap- 
xirent clerical errors and omis^ions in the "unit bid price" and the "amount bid" for contract bid items. 

(b) Omitted 1,'nit Bid Price - Amount Bid Completed - Quantitv Bid on Is C^ne I'nit: In the case 
it a bid item for which the "amount bid" is completed, but the "unit bid price" is omitted and the 
■quantitv " specified shown in the proposal for the bid item is onlv one unit, the "unit bid price" shall 
le deemed to be the same as the anmunl bid for that bid item and shall constitute the "contract unit 
^nce" for that bid item. 

(c) Omitted Unit Bid Price - .Amount Bid (Completed - Quantity Bid on Is More than One Init: 
n the case of a bid item for which "the amount bid" is completed (extension of the "unit bid price" 
:iv the quantity) but the "unit bid price" is omitted and the quantity shown in the proposal for the bid 
tern is more than one unit, the "unit bid price" shall be deemed to be the amount dcnved by dividing 



6:16 ISORTH CAR()LL\'A REGISTER November 15, 1991 1204 



FfyAL RILES 



the "amount bid" tor that item b\ the quantity shown in the proposal for that hid item and shall 
constitute the "contract unit price" for that bid item. 

(d) Discrepancy in the "Unit Bid Price" and the ".Vmount Bid": In the case of a bid item in which 
there is a discrepanc)' between the "unit bid price" and the extension for the bid item ("amount bid"), 
the "unit bid price" shall go\em. .As an exception to Paragraphs (a), (hi. and (c) of this Rule, on bids 
for contracts not funded with any Federal funds, the extension for the bid item ("amount bid "j shall 
govern V. hen the discrepancx" consists of an ob\"ious clerical mi^take in the "unit bid price" consisting 
of the misplacement of a decimal point. 1 he correction to the "unit bid price" will be made only when 
the following two conditions are met: 

I 1 ) Ihe corrected "unit bid price" multiplied by the quantity, equals the "amount bid" for the bid 

item. 
(2) The corrected "unit bid price" is closer to the average of the engineer's estimate and the indi- 

\idu<il bids for the contract item than the uncorrected "unit bid price". 

(e) Omitted "I'nit Bid Price" and Omitted "Amount Bid" - Deemed "Zero" Bid: The pro\-isions 
of this Paragraph shall apply only to bids for contracts not funded with any Federal funds. In the case 
of omission of the "unit bid price" and the omissitm of the "amount bid" for any one item and also 
in the case o{ the omission of the "amount bid" where a lump-sum pnce is called for, the "amount 
bid" and the "unit bid price" shall be deemed to be zero where the value of the omitted "amount 
bid" is one percent or less of the "total amount bid" for the entire project (excluding the omitted item). 
I'he value of the omitted "amount bid" will be deri\ed by determining the average of the engineer's 
estimate and the indi\ idual bids for that contract item. Wliere the "unit bid price" is deemed to be zero 
as pro\'ided in this Paragraph, such zero "unit bid price" shall constitute the 'contract unit price" for 
the affected bid item. Where the "amount bid" for a lump-sum bid item is deemed to be zero as pro- 
\ided in this Paragraph, such zero "amount bids" shall constitute the "contract lump-sum price" for 
that bid item. 1 his Paragraph shall not apply to the bid item for "Mobilization". 

(f) Unit bid pnces containing more than four decimal places: In the case of a Bid Item tor which the 
"amount bid" contains more than four decimal places for the "I nit Bid Price", only the whole number 
and the first four decimal places shall constitute the "Contract Unit Price" for that Bid Item. 

Ilisior: .\oie: Suniiu>n- Aiuhotitv GS. 136-ISi Ij: l43B-350i f); 
Eff. May I. I9S4: ' 
Amended Eff. Xovember I. I9Q1. 

.(KS15 RUJULIION OF BIDS 

(a) .Any bid submitted which fails to comply with an\' of the requirements of Rules .OSOS, .()S()'5 or 
.OSl 1 of this Section shall be considered irregular and ma\" be rejected. 

(b) Irregulanties due to apparent clerical errors and omissions may be waived in accordance with Rule 
.OS IS of this Section. 

(c) .AnN" bid including any unit or lump-sum bid price which is significantl\ unbalanced to the po- 
tential detriment of the Department will be considered iiregular and ma} be rejected. In the e\"ent the 
Board detemiincs it is in the best pubhc interest to accept such iiTegular bid. it may award the contract 
based on such bid subject to the provisions of subarticle l(i9-4(Bl of the Standard Specifications for 
Roads and Stmctures. 

(d) In addition to Paragraphs (a), (b). and (c) of this Rule, any bids tor contracts not funded with 
any Federal funds which are submitted by any bidder who has failed to obtain the appropriate Gcner.d 
Contractor s license, as required by Chapter S7 of the General Statutes of North Carolina, shall b^ 
considered irregular and will not be considered for award. 

(e) 'Fhe right to reject any and all bids shall be reser\'ed to the Board. 

Uisior: Sole: Siaiiiior; Auihornv GS. 136- IS, I j; J43B-350. fj: 
Eff. Aprils. 1 98 1;' 
Recodified from .OS 1 3: 
Amended Eff Sovember /. 1991: March /. I9S4. 

.0816 DISQU.AFIFICATION OF BIDDFRS 

-Any one of the following causes ma\' be justification for disqualifying a contractor from further bid- 
ding until he has applied for and ha\e been requalitied in accordance with Rule .nSUl of this Section: 



12115 6:16 .\()RTH CAR()LL\A RECLSTER .\ovcniber L\ 1991 



FINAL RULES 



(1) unsali>lact(ir\ progress in accordance with the tenns and conditit)ns of existing or previous con- 
tracts as specified in Article lOS-S or Article 105-7 of the Standard Specifications for Roads and 
Structures. 

(2) heirm declared m default in accordance with Article 108-9 of the Standard Specifications for 
Roads and Structures. 

(3) uncompleted contracts which, in the judgement of the C.^hief Ingineer may hinder or present the 
prompt completion of additional work if awarded. 

(4) fiilure to comply with prequalification rec]uirements. 

(5) the submission of more than one bid for the same work from an individual, partnership, joint 
\enture, or corporation under the same or different names. 

(6) evidence of collusion aiming bidders.; each participant in such collusion will be disqualified. 

(7) failure to furnish a non-collusion alTidavit upon request. 

(8) failure to comply with Article 108-6 of the Standard Specifications for Isoads and Structures. 

(9) failure to comply with a written order of the lingineer as provided in Article 105- 1 of the Standard 
Specifications for Roads and Structures, if in the judgment of the Chief I'ngineer such failure is 
of sufficient in.ignitude to warrant disqualification. 

(10) fiilure to satisfv the l)isad\antaged iiusiness inteq^rise rec|uiremcnts of the pro|ect special pro- 
visions. 

(1 1) I he Department has not received the amount due under a forfeited bid bt)nd. 

( 12) fulure to submit within hO da\s after being requested bv the I'ngineer, or the submission of false 
information in. the documents required bv .Article 109-4 of the Standard Specifications for Roads 
and Structures. 

( f3) failure to return o\erpa_\inents as directed by the I'ngineer. 

Uislorv Sole: StatiiloiT Aiilhorilv G.S. 136-ISi I ); 
i:ff. April 3. I')SI:' 
Rccodilu'd from .OSN; 
Amended i.ff. Sovemher I, IWI. 

.(tSI7 (ONSIDKRA HON OF BIDS 

.Vfter the bids are opened and read, they will be compared on the basis of the summation of the pro- 
tlucts of the quantities shown in the bid schetkile by the unit bid prices. 1 he results o{ such compar- 
isons will be immetliateh available to the public. In the event of errors, omissions, or discrepancies m 
the bid prices, eoiTcctions to the bid prices will be made in accordance with the provision of Rule .0818 
of tliis Section. Such corrected bid prices will be used for the comparison and consideration of bids. 

he riglit is reserved to reject any or aU bids, to waive teclmicahties, to request the low bidder to 
submit an up-to-date financial and ciperating statement, to advertise for new bids, or to proceed to i\o 
the work otherwise, if in the judgement of the board, the best mterests of the State will be promoted 
thereby. 

llisioiT Sole: Slaiuiofy Aiithorilv Ci.S. l3fi-IS( I !; 
I43B- 350(f): 
Eff April '3. I OS I: 
Recodified from .OS/5: 
Amended Eff. Sovemher /, /Wf- .May I. I9H4. 

.0818 \()\ ( OLI rSION AI FIDAMT AM) CFR I IFICATIONS 

(a) In compliance with Section 112(c) of title 23 LSC, and cuiTcnt regulations of the Department, 
■ ich and evcrv' bidder vviJl be required to furnish the Dep;irtment with ;in affidavit certifying that the 
bidder has not entered into any agreement, participated in any collusion, otherwise taken any action in 
traint of free competitive bidding in connection with his bid on the project. The affidavit shall also 
■onclusivelv indicate that the Bidder intends to do the work with its own bonafidc employees or sub- 
ontractors and it not bidding for the beneht of another contractor. 

lb) .Xtfidavit forms will be included in the proposal form as part of the signature sheets. Hxecution 
it the signature sheets will also constitute execution of the non-collusion affidavit. 1 he signature sheets 
hall be notarized. 

(c) .A non-collusion ceilification shall be executed by prime contractors and lower tier participants 
II each transaction involving public funds. Transactions which require certifications from lower tier 
>articipants are: 



6:16 NORTH CAROLLSA REGISTER November 15, 1991 1206 



FINAL RULES 



(1) Transactions between a prime contractor and a person, other than for a procurement contract, 
for goods or services, regardless of type. 

(2) Procurement contracts for goods and services, between a pnmc contractor and a person, re- 
gardless of type, expected to equal or exceed the Federal small purchase threshold fixed at 10 
U.S.C. 2304(g) and 41 I'.S.C. 253fg) [currently twenty-five thousand dollars ($25,000)1 under a 
prime contract. 

(3) Procurement contracts for goods or services between a pnme contractor and a person, regardless 
of the amount, under which that person will ha\e a critical intlucnce on or substantive control 
cner the transaction. .Such persons include, but are not limited to, bid estimators and contract 
managers. 

1 he certifications for both the prime contractor and the lower tier participants shall be on a form 
furnished b\- the Department of Transportation to comply with I ederal Highway Administration re- 
quirements, as published in 49 CIR Part 29. The prime contractor is responsible for obtaining the 
certifications from the lower tier participants and is responsible for keeping them as part of the contract 
records. 

lliston' Sole: StaiuUny Authority G.S. I36-IH( 1 1: 136-28.1: 143-54; 
Eff. April 3. 1981; 
Recodilled from .0816; 
Amended kjj. Soxembcr I. 1001; October I. 1601: July /, 1982. 

.(KS19 AWARD Ol C OMRACT 

(a) Cjeneral; The award of the contract, if it be awarded, will be made by the Board of lYansportation 
to the lowest responsible bidder. The lowest responsible bidder will be notified by letter that his bid 
has been accepted and that he has been awarded the contract. This letter shall constitute the notice 
of award. 'I he notice of award, if the award he made, will be issued within 60 days after the opening 
of bids, except that with the consent of the lowest responsible bidder the decision to award the contract 
to such bidder ma\ be delased tor as long a time as may be agreed upon by the Department and such 
bidder. In the absence of such agreement, the lowest responsible bidder ma\ withdraw his bid at the 
expiration of the 60 days w ithout penalt\ if no notice of award has been issued. 

Award of a contract in\'ohing any unbalanced bid price(s) may be made in accordance with the pro- 
\isions of Article 1(12-15 of the Standard Specifications for Roads and Structures. 

(b) .Award I imits: .\ Bidder who desires to bid on more than one project or which bids are to be 
opened on the same date, and who also desires to avoid recei\ing an award of more projects than he 
is eciuipped to handle, may bid on any number of projects but ma\ limit the total amount of work 
awarded to him on selected projects by completing the form ".Award limits on .Multiple Projects" for 
each project subject to the award limit. This form will be bound within each proposal form, I'his fomi 
will not be effecti\e unless the amount is filled in and the form is properly signed. In the cxent that a 
Bidtler is the lowest responsible Bidder on projects subject to the award limit and the \alue of such 
projects is more than the "award limit" established by such Bidder, the Board of Transportation will 
not award such Bidder projects from among those subject to the award limit which ha\-e a total \alue 
exceeding the award limit. The projects to be awarded to the Bidder will be those projects on which 
award will result in the lowest total cost to the Department of Transportation. 

In detennining the lowest total cost to the Department, the iiptions of rejecting a bid or readvertising 
lor new bids may be considered. 

All bids submitted without the properls executed form ".Award I imits on .Multiple Projects" will not 
be subject to the award limit. In the e\ent that there is a discrepanc)' between the completed award 
limit forms submitted by the same Bidder for the diflerent projects in a letting, the Department reserves 
the right to declare all such award limit torms in\alid or to make such interpretation of the discrepancy 
as may be in the best interests of the Department, Iloweser, the presence of such discrepancy shall 
not be reason for declaring any bid irregular nor shall it in\alidate the conditions of his bid bond or 
bill ileposit. 

Where a prequalificd Contractor bids indnidualK (as opposed to a Joint A'enture) on one or more 
projects and also bids on one or more projects as part of a Joint \'enture, such indnidual Bidder and 
such Joint A'enture will be considered separate bidders in apj^lying the pnnisions of this Rule. 

Ilistoiy \ote: Statutoiy Authoritv G.S. I36-18{ 1 j; 
Eff. April 3. 198/:' 
Recodified from .08 T; 



1207 6:16 \ORTH CAROLINA REGISTER Novemhcr L\ I99I 



FINAL RULES 



Amended l:fj: .\ or ember I. 1991. 

.0820 CANCKLLATION OF AW .ARl) 

The Board of Transportation rcscn,'cs the nght to rescind the award of any contract at any time before 
the receipt of the properly executed contract bonds from the successful bidder. 

Hislorv Sole: Statuiory Authoritv G.S. 136-ISl I ); 
Efj: Aprils, 1 98 1:' 
Recodified from .0818: 
Amended Eff. .\ovemher I. 1991. 

.0821 RIH RN Ol I5II) BOM) OR HII) DKPOSIT 

All bid bonds will be retained b\ the Department until the contract bonds are furnished by the suc- 
cessful bidder, after which all such bid bonds will be destroyed unless the indi\idual bid bond fonn 
contains a note requesting that it be returned to the bidder or the surety . 

(1) Cheeks which ha\e been furnished as a bid deposit by all bidders other than the three lowest re- 
sponsible bidders will be retained not nuirc than 10 days after the date of opening of bids, .\fter 
the expiration of such period, Department oi Iranspoitation waiTants in the eciui\alent amount 
of cheeks which were furnished as a bid deposit will be issued to all bidders other than the three 
lowest responsible bidders. 

(2) Checks which have been furnished as a bid deposit b\ the three lowest responsible bidders will 
be retained until after the contract bonds ha\'e been fumished by the successful bidder, at which 
time Depailnient of 1 ransportation wairants in the etiunalent amount of checks which were fur- 
nished as a bid deposit will be issued to the three lowest responsible bidders. 

lii.UoiT \()te: Stuiuton Auilwritv G.S. I36-I8( 1 1: 
Eff. Aprils, 1981;' 
Recodified from .08/9: 
Amended Eff. .\ovemher I. 1991. 

.0822 ( OM RACT BOMXS 

The successtul bidder, within ten days after the notice of award is received by him, shall pro\ ide the 
Department with a contract payment bond and a contract performance bond each in an amount equal 
to 100 percent of the amount of the contract. .\11 bonds shall be in conformance with G.S. 44.\-3-V 
I he corporate surety furnishing the bonds shall be authon/.ed to do business in the State. 

lliston' .\'ole: Shiliiion- .iuthoritr G.S. IS6-l8i I ): 
Eff. Aprils. / 98 f' 
Recodified from .0^20: 
Amended Eff .\'o\ ember f I99E 

.0823 i:\i:ci HON oi ( ovi ract 

As soon as possible follow ing receipt of the properly executed contract btmds. the Depaitment w ill 
complete the execution of the contract, retain the original contract, and letum one certified cop\ of the 
ontract to the contractor. 

Ilistorv Sole: Slatuion Authoritv G.S. IS6-I8( I); 
Eff April S. 1981:' 
Recodified from .0821: 
Amended Eff Xovember I. 1991. 

.0824 1 All, IRK rO I I RMSII (()MRA( I BONDS 

Ihe successful bidders failure to file acceptable bonds within 10 days after the notice of award is re- 
ceived by him will be just cause for the forfeiture of the bid bond or bid deposit and rescinding the 
award of the contract. .Award may then be made to the next lowest responsible bidder or the work 
may be readsertised and constructed under contract or otherwise, as the Board of Transportation may 
decide. 

llnloiy Xote: Stdtiitoty Authorized G.S. IS6-l8i I ): 



6:16 NORTH CAROLINA RECISTER November 15. I WI I20,S 



FISAL RULES 



Eff. Aprils. I9SI: 
Recodified from .0822; 
Amended Eff. Xovember 1. 1991 . 

.(1825 rOMIDKM lAI rrV OF ( OSI KSriMA I ES AM) BIDDING FISTS 

(a) -Ml co>t c^tlmatc^ prepared lor the purpose of companng bids; and the names and identity of 
corporations, fLrms, partnerships, individuals or joint \cnturers who have requested plans or proposal 
forms for the purposes of bidding, shall be confidential and not disclosed until after the opening of bids. 

(b) This information shall be furnished to the Federal Highway Administration in accordance with 
wnttcn rules, regulations, policies and procedures of the Federal Iligliway Administration. 

(c) The State Highway .Administrator is granted authonty to set procedures for the handlmg. com- 
pilation, distribution and disclosure of this information by NCDO 1 employees pnor to the opening 
of bids. 

(d) As an exception to the confidentiall\ rule pro\idcd for in Paragraph (a), the list of plan holders 
or potential bidders will be made pubhc pursuant to the tollowing criteria for either or Subparagraphs 
(1) and (2) of this Rule: 

(1) 1 he list shall be made public on those projects determined by the State Highway Hngincer- 
LX'sign that are of a special nature on which the work is not routme higliway work and or a 
major portion of the w ork w ill most likel\ be done by specialty contractor.'subcontractors. 

(2) The list of potential bidders shall be released on the projects m which a prc-bid conference is 
held. 

(3) I he list of potential bidders will be made a\ailable from the Proposals and Contracts Section 
of the Highway Design Branch one week prior to the openmg of bids. 

(4) F'ach potential bidder that obt;iins a set of plans proposals for a project wdl be given the option 
of ha\ing its name remain confidential. 

(e) 1 he bidder or contractor is cautioned that detail shown on the subsurface infonnation are pre- 
Uminars' only and in many cases the final design details are different. For bidding and construction 
purposes refer to the construction plans and documents for final design information on this project. 
1 he Department does not w anant or guarantee the sutTicienc\ or accuracy of the in\'cstigation made, 
nor the inteq^retations made or opinions of the L^epartment as to the type of materials and conditions 
to be encountered. The bidder or contractor is cautioned to make such independent subsurface in- 
vestigations as he deems necessars to satisfy himself as to conditions to be encountered on tlus project. 
Fhe contractor shall have no claim for additional compensation or for an extension of tune for any 

reason resulting from the actual conditions encountered at the site diffenng from those indicated in the 
subsuiface mtomiation. 

Ilision Sole: Statuiorv .Authoritv G.S. 133-33: 
Eff. September I, 'l9Sf 
.i mended Eff. .Mav /. !9S3: 
Recodified 'from .0823: 
.[mended Eff October /, /99E 

.(KS26 AW ARD I IMHS ON .MLLTII»I K PR(),Ji:C IS 

Hisiuir .\oie: Suituiun' .Authority G.S. I36-I8il!: 
EffJidvL 1983; ' 
Recodified from .0824; 
Repealed Eff .Xovember /. /W/. 

.0S2S ( OMPl FFR BID PRFFARA HON 

(a) .\ diskette to assist the Bidder in prcpanng his bid by means of a personal computer will be fur- 
nished by the Department if so requested by the Bidder at the same time he orders a proposal form. 
The diskette will contain an identical copy of the itemized proposal sheets included in the proposal and 
computer program which may be used to prepare a bid on the sheets. The bid diskette w ill function 
properly with an IBM personal computer or compatible computer using IDOS. 

(bi 1 he only entnes into the program which will be permitted by the bidder are the appropriate unit 
or lump-sum prices for those items which must be bid in order to provide a complete bid tor the 
project. L'nit prices shall be rounded off to four decimal places. When these entries ha\'e been made, 
the program will automatically prepare and pnnt a complete set of itemized proposal sheets which will 



1209 6:16 AORTH CAR()LI.\A REGISTER Xovember 15, 1991 



FINAL RULES 



include the amount bid for the various items and the total amount bid for the project in addition to the 
unit or lump-sum prices bid. This set of itemized proposal sheets, when submitted together with the 
appropriate proposal form, will constitute the bid and shall be delivered to the Department in accord- 
ance with Rule .0812 of this Section. If the Bidder submits his bid on computer generated itemized 
proposal sheets, bid prices shall not be written on the itemize proposal sheets bound in the proposal 
ibrm. Ihe computer generated itemized proposal sheets shall be signed by the same individual who 
has signed the proposal form. The bid diskette furnished by the Department shall be returned with 
the bid. 

(c) In the case of a discrepancy between the unit or lump-sum prices submitted on the itemized 
proposal sheets and those contained on the diskette furnished to the Department, the unit or lump-sum 
prices submitted on the itemized proposal sheet shall prevail. 

(d) Ihe provisions of Rule .0808 of this Section will apply to the preparation of bids except that the 
bid may be submitted on computer generated itemized proposal sheets in which case the entries on the 
itemized proposal sheets will not be required to be in ink. Changes to any entr>' on the computer 
generated itemized proposal sheets shall be made in accordance with requirement number 6 of Rule 
.0808 of this Section. When the Computer Generated Itemized Proposal Sheets are not signed ;md 
received with the proposal, this will constitute, no bid received. 

(e) The Department will not be responsible for loss or damage to a bid diskette after it has been 
mailed to the Bidder. If loss or damage occurs, the Bidder may order another bid diskette. 

History \ote: Statutori' Authoriiv G.S. 136-I8( I ): 
. Eff. November I, 1991. 

.0829 CONTRACT OFFICER 

(a) The position of Contract OfTicer in the Design Senices Umt is the designated Contract Officer 
for the Department of Iransportation. Ihe Contract Officer will execute aU construction and repair 
contracts and handle all correspondence related to irregularities, notification of award, and rejection of 
bids for such contracts. 

(b) If a proposal is accepted and the award is made by the Board of Transportation, the contract is 
valid only when signed either b>' the Contract Officer or such other person as may be designated by the 
Secretary to sign for the Department of Transportation. 1 he conditions and provisions contained in 
the proposal form cannot be changed except over the signature of the said Contract Officer. 

c) The position of State Design Services Hngineer is the designated alternate Contract Officer for the 
Department of Transportation with the authonty to act in behalf of the Contract Officer when the 
'ontract Officer is absent and unable to perform this function. 

Histor\: Note: Statutory Authoritv G.S. I36-IS(I); I36-2S.I; 
Eff. Sovember I, 1991. 

SFXTION .mm REGULATIONS FOR INFOR.\rAL 
CONSIRLCTION AND REPAIR CONIRACTS 

.0902 CONTRAC r REQl IREMENTS 

Hisloi-v Note: Statutor}' .4ut/wriiv G.S. I36-IS{1 ); J36-2S./; 
136-44.1; 136-45: '/43-350(f); 
Eff Febmary I. I9S7: 
Repealed Eff November I. 1991. 

SECTION .1000 - ADOPT- A-HIGHWAY PROGRAM 

1001 PI RPOSE 

The North Carolina Department of Transportation's Adopt-.\-IIigliway Program exists to support 
le Department's litter abatement efforts. 

Historv Note: Statutory Authoriiv G.S. I36-IS{ 10); 
Eff November I. 1991. 

1002 DEFINITIONS 



6.-/6 NORTH CAROLINA REGISTER Novembev 15, 1991 1210 



FINAL RULES 



(aj "/Vdoption" shall mean the agreement b>- an indnidual or group to pick up litter and trash from 
a specific section of highway right-of-way. 

(b) "Adopt-A-Highway Program" shall mean the public participation program of the Department 
designed to assist in the control and reduction of litter on state-maintained highway right-of-way. 

(c) ''.Adopted Section" shall mean the portion, generally two miles in length, of state-maintained 
highway right-of-way appro\ed for adoption by volunteers. 

(d) ".Authorized Representati\e" shall mean, in the case of an adoption by a group, the group 
members acting on behall" of the group for the purpose of adopting a section of highway. 

(e) "Department" shall mean the North Carolina Department of Transportation. 

(f) "Program" shall mean the Adopt-A-Highwa\ Program of the North Carolma Department of 
Transportation. 

(g) "Program Director" shall mean the Director of Beautification Programs of the North Carolina 
Department of Transportation who has oversight responsibilit) for the Program. 

(h) "Program Participants" shall mean the individuals and or groups that have adopted section of 
high\\ays. Civic and non-profit organizations, and commercial and private enterprises may be selected 
as groups for the purpose of adopting a section of highway. 

Ifisiotr Xole: Staiutoty Authoritv G.S. I36-IS( 10); 
F.ff. Sovember I, I9QI. 

.1003 PARIICII'.VTION IN THE PROGRAM 

(a) The adoption of a section of highway is a privilege in consideration for public sen, ice that may 
be granted b\' the Department to individuals and or groups who would assist the .Adopt-A-Ilighway 
Program in achieving its purpose. 

(b) C^ah individuals and or groups determined bv the Department to be responsible and to e,\liibit 
in good faith the willingness and the capacity to pertbnn the responsibilities of the Program will be al- 
lowed to adopt a highway. The Department mav' refuse to grant a request to adopt a section of high- 
way if, in its opinion, granting the request would jeopardize the Program, the counterproductive to its 
purpose or create a hazard to the safety of the public. Highway scifety is a principal concern in all de- 
cisions related to the Program. Program participants mav be discnminate on the basis of religion, race, 
nationcd ongm, se.\ or handicap (except where the handicap would affect the individual's safe partic- 
ipation m the Program) with respect to their participation in the Program. 

(c) Ihe Division Engineer or his designee shall approve apphcations of individuals and or groups 
apph'ing to participate in the Program. A fist of the newly approved participants, bv division, shall 
be submitted to the Program Director for review on the first of each month. Ihe approval of the Di- 
\'ision Engineer is final unless the applications is disapproved by the Program Director by the first day 
of the ne.\t calendar month. If the Div ision Engmeer has any uncertaintv regardmg the quafilications 
of the individual or group applving to the Program, the Division Engmeer shaU submit the application 
and all accompanying documents to the Program Director for final action. 

(d) Initial agreements of adoption will be for a period of one year. 

(c) Each person participating in the Program shaU execute a written release of the Department, its 
officials, employees and agents tVom any fiabifity arising out of his or her p^u^icipation m the Program. 
In the case of a minor, such release shall be executed by a parent or guardian. Physical p;ulicipation 
in the Program shall constitute a waiver by the participant of any claim or cause of action of liability 
against the Department. 

(f) Program participants are encouraged to recycle material coUected from the adopted section when 
it is feasible to do so. 

HistotT \otc: Sidtiiion Authoritv G.S. J36-/S( /O); 
EJT. Sovember I. 1991. 

.1004 AGREEMENT 

.An\" individual and or groups desiring to participate m the .Adopt-.A-IIighway Program v\ill submit 
an agreement to the Di\'ision Engineer of the Division in which the section of highway proposed for 
adoption is located. The agreement will be in the form prescribed bv- the Department and will contain 
at a minimum the following information: 

( 1 ) The higliway section to be adopted, as nearly as it can be described; 

(2) The dates of the requested adoption: 

(3) Ihe approximate number of people in the group who will be participating in each cleanup: 



/:// 6:16 NORTH CAROLLSA REGISTER November 15. 1 99 1 



FINAL RULES 



(4) I he name, telephone number, and complete street address of the authorized representative for the 
group and of all members of the group who will actually participate in the Program; 

(5) An acknowledgement by the group of the hazardous nature of the work involved in participating 
in the Program; 

(6) An acknowledgement that the members of the group agree jointl)' to be bound by and comply 
with the terms and conditions set forth in the agreement; and 

(7) The signatures of the Division P'ngineer, or his designee, and the Authorized Representati\e of 
the Program Participant. 

Histon ^ote: Stalutory Authority G.S. J36-/S( /O); 
Eff. November I, 1991. 

.1005 RESPONSIBILITIES OE PROGR.AM P.ARTItlPANTS AM) DEPARTMENT 

(a) Any individual and or group participating in the Adopt-.\- Highway Program wiU be subject to 
each of the following requirements and responsibilities: 

(1) Appointing or selecting an authorized representative to act on behalf of the group: 

(2) Ensunng that individual participants sign a statement acknowledging that they have attended a 
safetv meeting and view the Department's safety video before participating in the cleanup of the 
adopted section: 

(3) Obeying and abiding by the guidelines, safety requirements, and other terms and conditions 
established by the Department: 

(4) Picking up litter a minimum of four times a year, and as often as necessary to maintain a clean 
right-of-way; 

(5) Ensuring that each indi\idual participant of the group wears a Department approved safety vest 
or shirt during the pickup: 

(6) l-nsuring that each indi\ idual participant of the group wear clothing that will not impair vision 
or movement during the pickup; 

(7j Ensuring that attire that might divert the attention of motorist is not worn durmg clean up ac- 
tivities: 

(8) Eumishing adequate supervision by one or more adults 21 years of age or older for groups which 
have participants 12-17 years of age; 

(9) Ensuring that no one under the age of 12 is allowed to p;irticipate in the clean up acti\ities: 

(10) Prohibiting participants from either possessing or consuming alcohohc be\erages or other drugs 
during clean up activities; 

(11) Ensuring that no signs, posters, or other display material that might distract motorist are 
brouglit to the adopted section by group members during or between clean ups: 

(12) Eilmg alter actions reports as prescribed by the Department; and 

(13) Ensuring that all pro\isions of the agreement are fully peribnned. 

(b) The Department's participation in the Program will include the following: 

(1) Working with the group to determine the specific section of state right-of-way to be adopted; 

(2) Providing safety vest, trash bags and safety uitormation: 

(3) Erecting two signs, one at each end of the adopted section, with the group's name or acronym 
displayed. Ehe size, shape and graphic design of Adopt- A- Highway sign policy as appro\'ed by 
the Secretary of Transportation. In the case of theft, vandalism or destruction of a higlnvay sign, 
the Department will pro\ide one free replacement of the sign. Ihereafter, any replacement sign 
shall be paid for by the Program Participant: 

(4) Removing filled trash bags; 

(5) Removing litter from the adopted section under unusual circumstances, i.e., to remove large, 
heavy or hazardous items; 

(6) Monitoring to ensure the objectives of htter abatement are being met; and 

(7j Momtoring to exaluate the overall operation of the Program and to gauge its effectiveness. 

HistoiT note: Slatutoiy Authority G.S. I46-IS( 10): 
Eff. Sovember I, 1991. 

.1006 GENERAE EI.MITING CONDITIONS 

(a) Administrative, legislative and fmancial constraints subject Adopt-.\- Highway Program to certain 
imitations. 



6:16 NORTH CAROLINA REGISTER November 15, I99I 1212 



FINAL RULES 



(b) The I'rogram may, at any time and for any reason, be modified in scope or altered in any other 
marmer at the sole discretion of the Department. 

(c) The Department shall consider any factors it considers to be appropriate in determining what 
highways will be and will not be eligible for adoption. 

(d) The Department reser^'es the right to determine the designation of the section of right-of-way to 
be adopted. 1 he Department will consider community sentiment in determining the designation of the 
section of right-of-way to be adopted. 

(e) State roads in residential neighborhoods will not normally be available for adoption. Exceptions 
would include roads adopted by the neighborhood residents. Underlying fee owners' objections to a 
specific adoption uill be considered. 

(f) The Department is generally prohibited by law from e.xpendmg any funds, directly or indirectly, 
for the purpose of influencing the outcome of any election or the passage of any legislation. If any of 
the Program's actions are determined to be contrary to any statutory restrictions, or any restnctions 
on the use of appropriated funds for political activities, the Department wiU have the nght to take any 
necessar>' remedial action, including, but not limited to, the removal of the erected signs displaymg the 
Program Participant s name or acronym and or the termination of the adoption agreement. 

(g) Names, titles or words placed on Adopt- A- Highway signs must be appro\ed b\' the North 
Carolina Department of Transportation. 

lliston Sole: Statutorv Authority G.S. 138-18(10); 
[iff. Sovcmber I. 1991. 

Ami MODIFIC ATION/RKNKWAL/IKRMINAI ION OF IHE AGRKKMEM 

(a) The .\dopt-A-Highway agreement may be modified in scope or altered in any other manner at 
the discretion of the Department. 

(h) Program participants will ha\e the option of renewing the agreement, subject to the approval of 
the Department and the continuation of the Program by the Department. Information concerning 
Program participants is to be updated at the time of renewal. 

(c) The Department may terminate the agreement and or remo\e the .\dopt-A-Highway signs bear- 
ing the Program participant's name or acronym if it tinds and determines that the participant is not 
meeting the terms and considerations of the agreement, that the participant is acting contrary to the 
guidelines of the Program, that the adoption is proving to be counter productive to the Programs 
purpose, that undesirable results, such as increased htter, vandalism or sign theft, are resulting from the 
adoption, that Program participants have engaged in irresponsible conduct at the adopted section which 
would bring discredit upon the State, or that other good cause exist to terminate the agreement and or 
remove the Adopt-.\-IIighway sign. 

ffiston .\'o!c: Statutoij Authoritv G.S. 136-ISilOl; 
F.ff. Xovember I. 1991. 

.1008 ikrminahon of tuf program 

The .-\dopt-.\- Highway Program may at any time for any reason be terminated. 

Histon: Xoic: Statutory Authoritv G.S. J36-/8tJ0l; 
Eff. Sovember I. 1991. 

SI bchaptfr 2f miscellanfols operations 

SECTION .0200 - OUTDOOR AD\ ERTISING 

.0207 FEES AND RENEW ALS 

(a) Initial and annual renewal fees shall be retjuired to be paid by the owners of the outdoor adver- 
tising structures for each permit requested in order to defer the costs of the administrati\e and in- 
spection expenses incurred by the Di\ision of Highwa\s of the Department of Transportation in 
administering the permit procedures. 

(b) An initial nonrefundable fee of sixty dollars ($60.01)) per outdoor advertising structure shall be 
submitted with each application for a permit, and an annual nonrefundable renewal tee of thirt>' dollars 
($30.00) per sign structure shaU be paid by the owners of the outdoor ad\ertising structures on April 



1213 6:16 NORTH CAROLINA REGISTER Novewhcr 15, 1991 



FINAL RULES 



15 of each year to the appropnate district engineer. The owners of outdoor advertising structures must 
return the information required under Paragraph (c) of this Rule with their annual renewal fees. 

(c) Ihe Division of Highways of the Department of 1 ransportation shall, without request, send a 
statement to each owner of outdoor advertising structure(s) with valid permit for the annual renewal 
fee or fees and a renewal application. For a renewal to be approved, the renewal application must in- 
clude: 

(1) Existing Sign Permits issued prior to March 1, 1990 - Retain e.xisting permit renew;d require- 
ments of paying renewal fee upon receipt of invoice from Department. 

(2) Renewal of permit(s) which were issued on or after March 1, 1990 - If the lease or property in- 
terests and/or the right-of-entr>' agreements do not continue in full force and effect, the renewal 
application must include those documents as required under 19A NCAC 2E .0206(a). 

History Note: Statutory Authority G.S. 136-130; 136-133; 
Eff. Julv I. 1978; 

Amended Eff. October I, 1991; December I. 1990: 
July I. I9H6: Januaiy I, 1983. 

.0210 REVOCATION OF FKRMIT 

Any vaUd pcnnit issued for a lawful outdoor advertising structure shall be revoked by the appropriate 
district engineer for any one of the following reasons: 

(1) mistake of material facts by the issuing authority for which had the correct facts been made 
known, the outdoor advertising permit in question would not have been issued; 

(2) misrepresentations of material facts by the outdoor advertiser on the application for permit for 
outdoor advertising; 

(3) failure to pay annual renewal fees and/or provide the documentation required under Rule 
.02U7(c) of this Section; 

(4) failure to construct the outdoor advertising structure and affix the permanent emblem witliin 180 
days from the date of issuance of the outdoor advertising permit; 

(5) any alteration of an outdoor advertising structure for which a permit has previously been issued 
which would cause that outdoor advertising structure to fail to comply with the provisions of the 
Outdoor Advertising Control Act and the rules and regulations promulgated by the Board of 
Transportation pursu;int thereto; 

(6) making alterations to a noncoiifonning sign or a sign confonning by \irtue of the grandfather 
clause which would cause it to be other than substantially the same as it was on the date the sign 
became nonconforming, or a grandfather clause sign. Alterations to a sign include any of the fol- 
lowing: 

(a) enlarges a dimension of the sign facing, or that raises the heiglit of the sign; 

(b) changing the material of the sign stiiicture's support; 

(c) adding a pole or poles; 

(d) addmg illumination; or 

(e) any other alteration of a nonconforming outdoor advertising structure. 

(7) failure to affix permanent permit emblem within 30 days after erection of the outdoor ad\crtising 
stmcture: 

(8) unlawful destruction of trees or shrubs or other growlh located on the right of way in order to 
increase or enhance the visibility of an outdoor advertising structure; 

(9) unlawful \iolation of the control of access on interstate, freeway, and other controlled access fa- 
cilities; 

(10) failure to maintain a sign such that it remains blank for a period of 12 consecutive months; 

(11) failure to maintain a sign such that it reaches a state of dilapidation as detlned in Rule .0201(y) 
of tliis Section; 

(12) abandonment, or destruction of a sign. 

Histoty Note: Statutory Aulhoritv G.S. 1 36-/ 30; 136-134: 
Eff Julv I. I97S; ' 
Amended Eff October I. 1991: December /, 1990. 

0213 APPEAL OF DFCISION OF DISTRICT FNC.INEFR TO SFC. OF IRANS. 

(a) Should any owner of an outdoor advertising stmcture disagree with a decision of the appropriate 
istrict engineer pertaining to the issuance or revocation of permits for outdoor ad\ertising, the owner 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1214 



FINAL RULES 



of the outdoor advertising structure shall have the right to appeal to the Secretary' of Transportation 
pursuant to the procedures hereinafter set out. 

(b) The owner of the outdoor advertising structure who decides to appeal a decision of the district 
engineer shaU so notify the appropriate district engineer of his decision to appeal by certified mail, re- 
turn receipt requested, within 10 days of the receipt of notice of the decision of the district engineer. 
The distnct engineer shall then forward the notice gi\en to him by the outdoor advertiser to the Sec- 
retary of Iransportation. 

(c) Within 20 days from the time of submitting his notice of appeal to the district engineer, the owner 
of the outdoor advertising structure shall submit to the Secretary of Transportation a written appeal 
setting forth with particularity the facts upon which his appeal is based. 

(d) Within 90 days from the receipt of the said written appeal or within such additional time as may 
be agreed to between the Secretary of Tnmsportation and the owner of the outdoor advertising struc- 
ture, the Secretary of Transportation shall make an in\estigation of the said appeal. 1 he Secretary' of 
Transportation shall then make appropriate findings of fact and conclusions pertaining to the appeal 
on behalf of the Department of Transportation and the findings and conclusion shall be served upon 
the outdoor advertiser seeking the review by certified mail, return receipt requested. However, if the 
decision of the secretary is that the outdoor ad\-ertising structure in question is unlawful, then the 
findings and conclusion shall be served upon the owner of the outdoor advertising structure by certified 
mail, return receipt requested. 

llistorv .\ote: Slatuton Aiithoritv G.S. 136-130; 136-133; 136-134; 
Eff.Julvl. 197S; ' 
Amended Eff. .\ovember I, 1991; June 15. 19SI. 

.0216 SPECIFIC INFORMATION SIGNING PROGRAM 

The Specific Information Signing Progrcmi, hereinafter "Program", pro\ides certain eligible businesses 
with the opportunity to be fisted on official signs within the right-of-way of interstate highways and 
fully controlled access highways. The TralTic Engineering Branch is responsible for receiving requests 
for information concerning the Program. Direct request to the State Traffic Engmcer. Division of 
Highways. Department of Transportation, P. (). Box 25201, Raleigh. N. C. 27611. Di\ision 1-ngineers 
for the di\ ision in which the interchange is located are responsible for receiving and distributing appli- 
cations and copies of poficies and procedures, executing agreements and administering the agreements 
in accord with the rules, regulations, poficies and procedures of the board and the department. 

Histoiy Sote; Aulhoritv G.S. 136-89.56; 136-137; 136-139; 
143B-346; 143B-348: 143B-350ff); 
23 C.F.R. 750, Subpart A; 23 U.S.C. 131(f); 
Eff. April I. 19S2: 
Amended Eff October 1. 1991; Sovember 1, 19S5. 

.02 1 8 LOCATION OF PANELS 

The department shall control the erection and maintenance of official signs gi\'ing specific information 
of interest to the trascling pubfic in accordance with following criteria; 

(1) The department ma_\' erect panels at rural interchanges. The department may also erect panels 
at an interchange within a municipal corporate limit with a population of 25,000 or less, at the time 
appfication for business signs is made. If an interchange is taken into a municipal corporate limit 
after the initial business signs are erected, business signs may be added to the original panels until 
the panels ha\'e the full complement of business signs. No additional panels w iU be erected at an 
interch:mge that has been taken into a municipal corporate limit with 25,000 population or greater. 

(2) Panels shall be fabricated and located as detailed on the signing plans for the interchanges and 
shaU be located in a manner to take advantage of natural terrain and to ha\e the least impact on 
the scenic environment. 

(3) A separate mainline panel shall be pro\'ided on the interchange approach for each quafified t\pe 
of motorist ser\'ice except as pro\ ided in (d) of this Rule. No more than one panel shall be erected 
for a t\pe of ser\ice in each direction approaching an interchange. Where a qualified type of 
motorist senice is not a\ailable at an interchange, the panel may not be erected. .\ maximum 
number of six specific business (logo) signs may be installed on any logo panel for each service t) pe 
at an interchanse. 



1215 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



(4) The mainline panels shall be erected between the previous interchange and 800 feet in advance 
of the exit direction sign for the interchange from which the services are available. 1 he panels 
should be placed m alignment farther from the roadway (preferably 40 feet from roadway) than 
that of guide signs. There shall be at least 800 feet spacing between the panels and guide signs. 
In the direction of traffic, the successive panels shall be those for "C.'WIPING", "LODGING", 
"FOOD", and "GAS" in that order. A combination type panel may be used in remote rural areas 
of the Interstate System, or other fuUy controlled access highway and when space does not permit 
all signs and only two of each type of service is available at the location. A maximum of three 
business signs may appear below each respective service on a combination type panel. , If all four 
services are available, "GAS" and "I-OOD" should be combined on one sign, and "LODGING" 
and "CAMPING" should be combined on one sign. When the number of business facilities at a 
rural interch;mge are increased to more than three for one or more services, existing combination 
service business signing must be removed and replaced with sign panels, dedicated to each service. 
If the spacing limitations prohibit the erection of Specific Information Panels for all of the types 
of services available, preference shall be given to "GAS", "lOOD", "LODGING" or "CA.XIP- 
ING" services in that order. No panels shall be erected where minimum spacing limitations can- 
not be met. 

If a panel(s) cannot be erected due to spacing limitations, a supplemental service sign, which hsts 
the additional services available, may be erected below existing guide sign(s). Not more than three 
services may be erected below an existing guide sign. 

(5) On each exit ramp, a ramp panel for the c]ualified type of motorist service may be erected. 
If all of the qualified services are visible from the exit ramp terminal, ramp panels are not required. 

(6) The ramp panel shall be erected as detailed on the signing plans for the interchange. If conditions 
permit, the successive panels along the ramp in the direction of traffic shall be those for "CA.MP- 
ING", "LODGING", "FOOD", and "GAS" in that order. 

(7) The signing panels on the ramps should be consistent with those on the mainline. If there is in- 
sufficient space on the ramp or the mainline for all the panels, prionty shall be given to "GAS", 
"FOOD", "LODGING", then "CA.MPING" services in that order. If panel(s) cannot be erected 
on a ramp due to spacing limitations, a supplemental service sign, which lists the additional services 
available, may be erected. 

(8) Panels shall not be erected at an interchange where the motorist cannot conveniently re-enter the 
freeway and continue in the same direction of travel. Panels shall not be erected at any interchange 
with another controlled access facility. 

Hisloiy Note: Aulhoritv G.S. 136-39.56; / 36- J 37; 136-139; 
1 43 B- 346; I43B-34S; /43B-350(f); 
23 C.F.R. 750, Subpart A; 23 U.S.C. 131 (f I; 
Eff. April I, I9S2; 

Amended Eff. October I. 1991; April I. !9S6; 
Xovember I. I9S5. 

.(1219 KLIGIIJILH V FOR PROGRAM 

Business signs may be permitted, provided said businesses complv v\ ith the following criteria and have 
public telephone: 

(1) The individual business installation whose name, svmbol or trademark appears on a business sign 
shall give wntten assurance of the business's conformity with all appUcable laws concerning the 
provision of public accommodations without regard to race, rehgion, color, sex, or national origin. 
An individual business may apply for additional sign positions on a sign panel provided no quali- 
fied applicant is denied space on the sign panel. An individual business, under construction, may 
participate in the program b\ giving written assurance of the business's conlbrmitv' with all appli- 
cable laws and requirements for that type of service, by a specified date of opening to be within 
one year of the date of apphcation. 

(2) The maximum distance that a "GAS" "FOOD", or "LODGING" service can be located from 
the Interstate, or other fully controlled access highway shall not exceed three miles, v\ith the 
maximum distance being ten miles for a "CAMPING" service, in either direction via an all- 
v\eather road. Said distances shall be measured from the point on the interchange crossroad, co- 
incident with the centerline of the Interstate or other fully controlled access highway route median, 
along the roadways to the respective motorist service. The point to be measured to for each 
business is a point on the roadway that is perpendicular to the comer of the nearest wall of the 



6:16 NORTH CAROLINA REGISTER November 15, I99I 1216 



FINAL RULES 



business to the interchange. The wall to be measured to shall be that of the main building or of- 
fice. Walls of sheds (concession stands, storage buildings, separate restrooms, etc.) whether or not 
attached to the main building are not to be used for the purposes of measuring. If the office (main 
building) of a business is located more than .2 mile from a pubhc road on a private road or drive, 
the distance to the otTice along the said drive/road shall be included in the overall distance meas- 
ured to determine whether or not the busmess quahfies for business signing. The office shall be 
presumed to be at the place where the services are provided. 

(3) "GAS" and associated services. Criteria for erection of a business sign on a panel shall include: 

(a) appropriate licensing as required by law; 

(b) vehicle services for fuel, motor oil, tire repair (by an employee) and water; 

(c) restroom facilities and drinkmg water suitable for public use; 

(d) an on-premise attendant to collect monies, make change, and make or arrange for tire repairs; 

(e) year-round operation at least 16 continuous hours per day, seven days a week. 

(4) "lOOD". Criteria for erection of a business sign on a panel shall include; 

(a) appropriate licensing as required by law, and a permit to operate by the health department; 

(b) year-round operation at least 12 continuous hours per day to serve three meals a day (sandwich 
type entrees may be considered a meal) (breakfast, lunch, supper), seven days a week; 

(c) indoor seating for at least 20 persons; 

(d) public restroom facilities. 

(5) 'T ODGING". Criteria for erection of a business sign on a panel shall include: 

(a) appropriate licensing as required by law, and a permit to operate by the health department; 

(b) adequate sleeping accommodations consisting of a minimum of 10 units each, including 
bathroom and sleeping room; 

(c) off-street vehicle parking for each lodging room for rent; 

(d) \ ear-round operation. 

(6) ''C.Wll'ING". Criteria for erection of a business sign on a panel shall include: 

(a) appropriate licensing as required by law, including meeting aU state and county health and san- 
itation codes and ha\ing adequate water and sewer systems which ha\e been duly inspected and 
approved by the local health authority (the operator shall present evidence of such inspection 
and approval); 

(b) at least 10 campsites with accommodations for all types of tra\ el-trailers, tents and camping 
vehicles: 

(c) adequate parking accommodations; 

(d) continuous operation, seven days a week during business season; 

(e) remo\al or masking of said business sign by the department during off seasons, if operated on 
a seasonal basis. 

llistofj .\oie: Aiuhoritv G.S. I36-S9.56: 136-137; 136-139: 
I43B-346; I43B-34S: l43B-350(f): 
23 C.F.R. 750. Subpart A: 23 U.S.C. 131 if I; 
L'ff. April I. I<JH2: 

Amended Eff. October I. 1991: September I. 1990: 
Sovember I, 1987: April I. 19H6. 

.0222 COM RAC IS WTFH THE DKPAR IMEM 

(a) The department shall perform all required installation, maintenance, removal and or replacement 
ot aU busmess signs upon panels. 

(b) lndi\idual businesses requesting placement of business signs on panels shall apply by submitting 
to the Department of Transportation a completed Agreement form. As a condition of said Agreement, 
the applicant must agree to submit the required initial fee within 30 days alter the business is approved 
by the department. The department shall provide a statement(s) to the applicant at the time agree- 
ments are provided that itemize the number of business signs required, their fee(s) and remittance re- 
quirements. I-ailure to submit the required fee and forms will result in remo\al by the department of 
the business's signs from the construction project plans. 

(c) Businesses must submit a layout of their proposed business sign for appro\al by the department 
before the business sign is fabricated. 

(d) No business sign shall be displased which, in the opinion of the department, is unsigluly. badly 
faded, or in a substantial state of dilapidation. The department shall remove, replace, or mask any such 
business signs as appropnate. Ordinary initial installation and maintenance ser\'ices shall be performed 



1217 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



by the department at such necessary times upon payment of the annual renewal fee, and removal shall 
be performed upon failure to pay any fee or for violation of any provision of these Rules and the 
business sign shall be removed. The business shall furnish all business signs. 

(e) When a business sign is removed, it will be taken to the division traffic services shop of the division 
in which the business is located. The business will be notified of such removal and given 30 days in 
which to retrieve their business sign(s). After 30 days, the business sign wLU become the property of 
the department and will be disposed of as the department shall see fit. 

(t) Should the department determine that trailblazing to a business that is signed for at the interchange 
is desirable, it shall be done with an assembly (or series of assemblies) consisting of a ramp size business 
sign and an appropriate white on blue arrow. The business shall furnish all business sign(s) required 
and deemed necessary by the department. Fees shall be same as for other business sign(s). If se\eral 
difTcrent services are located on the same business site, dupUcate type logo signs shall not be erected in 
a single logo trailblazxr installation. In such trailblazer installations, only one logo sign and one di- 
rectional arrow sign will be used. The business may submit, subject to approval by the department, 
different logo signs to identify different services which may be located on the same business site. 

g) Should a business qualify for business signs at two interchanges, the business sign(s) will be 
erected at the nearest interchange. If the business desires signing at the other interchange also, it may 
be so signed provided it does not prevent another business from being signed. 

(h) WTierc there are more businesses which meet the criteria to participate in the program than space 
is available on the panel(s), then those businesses closer to the interchange, measured as described in 
Rule .0219(b), shall be permitted to participate, except as pro\ided for m Rule .0221 (a), (e), and (f). 
A business, under construction, shall not be aUowed to apply for participation in the program if its 
participation would prevent an existing open business applicant from participating, unless the open 
business has turned down a previous opportunity offered by the Department to participate in the pro- 
gram as provided in Rule .0222 (i). /Vfter approval of an application to participate a business, under 
;onstruction, shall be allowed priority participation over another business, which qualifies and becomes 
Dpen for business prior to the time specified for opening in the appUcation by the business under con- 
tmction. 

(i) Should the number of businesses of a particular service at an interchange increase to more than 
he maximum number of business signs allowed on a panel, and a closer business qualities and requests 
nstallation of its business signs, the business sign(s) of the farthest business shall be removed at the 
enevval date, pro\idcd that any business which has previously paid the fuO cost of erecting a panel shall 
lot be removed under this Rule. A business with more than one sign displayed on any panel shall ha\e 
he additional sign(s) removed at the end of a contract period when other qualif\ing business(cs) apphes 
or space on the panels. A business which has turned down a previous opportunity offered by the 
Icpartment to participate in the program may not qualify as a closer business under tlus Rule, except 
IS provided in Rule .0221 (a), (e), and (f). 

A business closed for reconstruction or reno\'ation, or for restoration of damages caused by fire or 
torm shall notify the division engineer's office immediately upon closing. I he business will be granted 
speeilicd time period, up to one year, to complete the construction, renovation, or restoration, pro- 
ided all logo fees are maintained and the same type of qualif) ing service is provided after reopening, 
vcn if under a different business name. The business signs will be removed from the panels and stored 
y the department until notice of reopening is received. The signs will then be reinstalled upon pay- 
lent of a fee of twenty-fi\e dollars ($25.00j per sign. At the time specified for reopening, if the business 
nder construction, reconstruction, renovation, or restoration is found not be be in compliance, or not 
pen for business, the Di\ ision Engineer, or his employee shall promptly verify the inibrmation. 
(j) When it comes to the attention of the department that a participating business is not in compliance 
th the minimum state criteria, the division engineer's office shall promptly \crify the infonnation and 
a breach of agreement is ascertained, inform the business that it will be given a maximum of 30 days 
3 correct any deficiencies or its business signs w iU be remo\ed. If the business is removed and later 
pplies for reinstatement, this request shall be handled in the same manner as a request from a new 
pplicant. 

\t the time specified for opening, if the business under construction is found to not be in compliance, 
r not open for business, the Division Engineer shall promptly verify the information. If a breach of 
jrecment is ascertained, the Division Engineer shall inform the business that it will be given a maxi- 
lum of 30 days to correct any deficiencies or its business signs will not be erected. If the business later 
:iplies for reinstatement, this request will be handled in the same m;uiner as a request from a new ap- 
licant. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1218 



FINAL RULES 



(k) The department reserves the right to cover or remove any or all business signs in the conduct of 
maintenance or construction operations, or for research studies, or whenever deemed by the department 
to be in the best interest of the department or the traveling pubhc, without advance notice thereof 
The department reserves the right to terminate this program or any portion thereof by furnishing the 
business written notice of such intent not less than 30 calendar days prior thereto. 

(1) The transfer of ownership of a business for which an agreement has been lawfully executed with 
the original owner shall not in any way alTect the validity of the agreement for the business sign(s) of 
the busmess, provided that the appropriate division engineer is given notice in writing of the transfer 
of ownership within 30 days of the actual transfer. 

Hiitoiy Sole: Authohty G.S. 136-89.56; 136-137: 136-139: 

I43B-346: I43B-348: l43B-350(f): 23 C.F.R. 750. 

Subpart A; 23 U.S.C. 131(f); 

Eff. April I, 1982; 

Amended Eff. October I. 1991; September I. 1990; 

Sovember l] 1987; April I, 1986. 

SFXTION .040<) - GENERAL ORDINANCES 

.0404 HIGmVAV OBSTRl CTIONS INTFRFFRrsT. \\ FIH TRAFFIC/MAFSTFAANCE 

Higliway obstructions includes driveway headwalls, fences, rural mailboxes, newspaper dehvcry boxes 
and other roadside obstructions interfering with traffic or maintenance. 

(1) It shall be unlawful to place any highway obstruction, including a driveway headvvall, fence, rural 
mailbox, newspaper dehvery box or other roadside obstruction, so as to interi'ere with the traffic 
or maintenance of the roads and highways of the state higliway system. 

(2) Iffcctive ,\pnl 5, I'^'M. after a detennination based upon current safety standards that any high- 
way obstruction, includmg a driveway headwail, fence, rural mailbox, newspaper delivery box, its 
supports or other roadside obstruction, constitutes an unreasonable roadside collision hazard, the 
highway obstmction shall be removed within 30 days after written notice to the person responsible 
for placing the obstruction within the right of way. 

(3) Only mailboxes and or newspaper delivers boxes with non-ngid t\pc posts, such as a 4" x 4" 
wooden or a small diameter metal type, are pennittcd on road additions to the state highway sys- 
tem after May 3, 1990. This policy prohibits the location within the right of way of an addition 
to the system of any brick columns or mailboxes and or newspaper deli\er\ boxes on ngid stands 
such as block, stone, or any other type dctennined to be a traffic hazard. 

(4) The failure of the person responsible for placing the unlawful obstiTJCtion within the right of way, 
to remove the obstruction within 30 days after written notice by the Department of Transportation 
shall constitute a misdemeanor. Failure to remo\e or make safe any mailbox and. or newspaper 
dehvcrv' box. its supports or any other obstruction within the specified 30 days of this Rule shall 
be cause for the Department's Division Engineer to take action to remove the unacceptable mail- 
box and or newspaper dehvery box, its supports or other obstruction installation and also bill the 
responsible party for the expense of removal if appropriate. 

(5) The publication entitled ".A Guide for Irccting .Mailboxes on Highways" published by the 
.\merican Association of State Highway and Iransportation Officials, dated Ma\ 24, 1984, shall 
be applied in carrving out this ordinance. 

Histon! Sole: Statuton Authority G.S. 136-/8(5 i; 136-90; 
136-93; 'l43B-350{l3l; 
Eff. July I. 1978: 
Amended Eff. October 1, 1991. 

.0407 CONTROL AND RFGLLATION OF ROADSIDE PARKS AND REST AREAS 

It shall be unlawful, within an\' scenic service o\'crlook, rest area or other designated parking area on 
the primarv' and secondary" roads and highways of the state, for any person, firm or corporation to erect 
tents, booths, or structures of any kind for camping or any other activity; to create loud music or other 
objectionable noise: except as pennittcd pursuant to I'^'.A NCAC 2E .0800 of the North Carolina Ad- 
ministratis Code, to solicit contributions, names, support or for any other purjiosc; to conduct or 
participate in pubhc or private auctions and other ceremonies: to distribute tracts, pamphlets, favors 
or any material, product or literature: to erect displays, signs, or carry on any commercial activity; to 



1219 6:16 NORTH CAROLIN.A REGISTER November 15, 1991 



FINAL RULES 



use public address systems; to distribute or use alcoholic beverages; to engage in disorderly conduct or 
use vulgar, obscene or profane language; or, to commit any nuisance producing a material annoyance, 
inconvenience, hurt, discomfort, or that is dangerous to the life, property and welfare of the traveling 
public. 

History Note: Statutory Authority G.S. 136-18(9): 136-125; 
Eff. July I. 1978: 
Amended Eff. October I, 1991; August I. 1986. 

.0417 COMMERCIAL ENTRANCES ESI ERSEC TING WITH RIGHT OF WAY 

It shall be unlawful to revise or construct any commercial entrances to intersect with the right of way 
of any primary or secondary highway or road of the State Highway System until a permit has first been 
obtained from the Department of Transportation or its authorized agent in accordance with the Rules 
and Regulations contained in 19A NCAC 2B, Section .0600, titled "Driveway Entrances". 

History Note: Statutory Authority G.S. I36-IS{10); 136-93; 
Eff July I. 1978; 
Amended Eff October 1, 1991. 

.0421 UTILITY WIRES OR CABLES OVER HIGHWAYS 

It shall be unlawful to construct any power, telephone, television, telegraph, or any other utility wires 
or cables over highways or roads on the State Highway System unless such wires have the minimum 
\ crtical clearance above the highest elevation of the road or highway crossed by them as prescnbed in 
the American National Standards Institute's National Electrical Safety Code for the installation and 
maintenance of electric supply and communication lines, as amended and as may be amended by the 
National Electrical Safety Code; except, a minimum vertical clearance of 18 feet shall be maintained for 
overhead power and communication lines crossing all highways. The lateral and vertical clearance from 
bridges should conform with the National Electrical Safety Code; however, greater clearances at bridges 
may be required by the Department of Transportation to provide for bridge construction and mainte- 
nance. Parallel utility lines occupying highway nght of way shall maintain a minimum \ ertical clear- 
ance of (15.5) feet as stated in the National Electrical Safety Code. 

Note: Rules for the preparation and submission of applications for utilitv encroachments can be found 
in 19A NCAC 2B .0500. 

History Note: Statutory Authority G.S. I36-I8{ 10); 136-89.50; 136-93; 
Eff July 1. 1978: ' 
Amended Eff November 1. 1991. 

.0424 HMN IRAILERS ACCESS ROUTES 

History Note: Authority G.S. 20-1 15.1 : 

Board of Transportation minutes on November IS, 1989: 
Eff. September 1. 1990; 
Repealed Eff November 1. 1991. 

.0425 ACCESS ROUTES/SEMLTRAIEER TRUCKS WITH 48/53 LOOT TRAILERS 

Histon' Note: Statutory Authority G.S. 20-1 15.1 : 20-1 16; 
Eff October 1, 1991; 
Repealed Eff November 1. 1991. 

.0426 ACCESS ROUTES EOR STAA DIMENSIONED \ EIIICLES 

The "Rules for Twin-Trailer Truck Access Routes" adopted by the Board of Transportation on No- 
vember 18, 1988, and the "Rules for Access Routes for Semi-Trailer Trucks with 48/5.VFoot 
Trailers" adopted bv the Board on October 13, 1989, are hereby amended in tliis Section. 
(1) DHFINITIONS: 
(a) S IVNjV Dimensioned Vehicles: 

(i) "Twin-trader trucks" - The vehicle combination consisting of a truck-tractor and two trailing 
units, 102 inches wide, as authorized by G.S. 20-1 15.1. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1220 



FINAL Ri'LES 



(ii) "4^-1(101 Scmi-traikTS trucks" - I'hc \ chicle combination consisting of a truck-tractor and one 
trailer 4S feet in length, 102 inches wide, as authon/cd by (i.S. 20-1 15.1. 

(iii) ".^.Vfoot Semi- Trailers trucks" - I'he \ehicle combination consisting of a truck-tractor and 
one trailer 53 feet in length, 102 inches wide, and a "kingpin" axle distance of 41 feet, as au- 
di, ^r-,/,.,1 K^ r; ^ ")n_ I I s r .n,i r; *c ")0_iia 



(b) 



thon/ed by Ci.S. 20- 1 15. F and G.S. 20-116. 

National Truck Network - A network of highway routes within the State consisting of the 
Interstate and certain I'ederal-aid I'nmary highwa\s designated tor S T.\/\ dimensioned vehicle 
use by the l.'.S. Secretars of 1 ransportation, and other highway routes that ha\e been designated 
tor this type \ehicle use b\ the North C\uolina Department of Transportation under the au- 
thonty of C].S. 20- 115. Kg). 

(c) " Tcnninal" - The tenn "tenninal' means an\ location where: 

(il Treight either ongmates, tcniunatcs, or is handled in the transportation process, or 
(li) Commercial motor carriers maint;un operating facilities. 

(d) "Reasonable .Access" - The tenn "reasonable access" means proMsions for S TAA dimensioned 
\ehicle access to tennin.ds ,md services from the Natioii.d Truck Network, as defined in I'ara- 
giaph (lKd)(i)(u) (.\)(i5| of this Rule: 

(i) Tenninals 1 ocated Within Three Road Miles of the Nation;d Truck Network: 

(.\) Reasonable access shall be deemed to be the use of the most reasonable, and practical 

route(s) ;uailable tV>r .iccess to tenninals, and services lor gas, food, lodging, and repairs. 
(B) .\n access route(s) may only be denied by the Department of Transportation based on 
specific safety reasons on indi\idual routes, 
(li) Tenninals 1 ocated Bexond Three Road Miles of the National Truck Network: 

(.\) Reasonable access shall be deemed to be the use of onl\ those routes specifically authorized 
b\ the Department of Transpoilation, or piinided for in this Section, for access to tenninals. 
(B) .\uthori/ation b\ the {department of Transportaticin shall cimsist of an application review 
and approv.d process for these access routes, as provided in this Section. .\n application 
process is utilr/.ed, since access route appio\,iI b\ pennit tor twin-trailer trucks is prohibited 
b\ Ci.S. 20-1 l'5(a). 
(2) Rl ASONABl T .\CX TSS I'ROC T IH RIS: 

(a) S T.\.\ dimensioned \ehicles are allowed "reasonable access" between tenninals and the National 

Truck Network onl\ in accordance with this Section. 

(b) Tor access to tenninals and ser\ice facilities located withm three road miles of the National 
Network no tiling or authori/.ition b\ the Department of Transportation is required. 

(c) For access to tenninals located beyond three road miles from the National Tnick Netwiirk in 
the procedures shown in Paragraph (2)(c)(T) through (vii) of this Rule shall applv: 

(1) .\ccess routes approved poor tci June 1, K^'-'l tor any one particuku type iif S TAA dimensioned 

\ chicle are approv ed tor all S T.\.\ dimensioned \ chicles for access purposes only, 
(li) Tenninal citl'icials :ind truck operators shall submit an application for a proposed new access 
routc(s) to the State TratTie Tngineer of the Depculment of Transportation tor appro\al. The 
application sh;dl be on a tonn prcivided b\ the State TratTic Tngineer. The submittal shall also 
include a map, or photocopy of a portion of a map. showing the proposed access route(s) or 
changes to an existing approved access route! s) ,ind the tenniiKil location. 
(lii) When appropriate, the State Traffic linginecr will seek advice trom the State lligliway Patrol. 
the Division oi .Motor \'ehicles, or other appropriate law enforcement officials concerning the 
application. 
(iv) Public notice of all applications for ■reasonable access" pursuant to this I'aragraph (2)(c) shall 
be published by the l^epailnient of Transport, ition in a newsp,iper regularly circulated in the 
.dfected area of the State. The notice shall be published at least once a week on the same day 
of the week for two consecutive weeks. In addition, governing bodies of incoq'iorated munici- 
palities will be notified bv' the Department of Transport.ition of all applications withm their ju- 
risdictions. 
(V) .Access Route Review and Tvaluation: 

(.\) The review and evaluation process of access routes will utilize the application o( vehicle 
templates where suitable roadway pkms or photographs are available for the requested 
route(s)- Where such plans or photographs ;ire not available and the use of vehicle templates 
is not practical, the State 1 r;dhc Engineer shall recjuire the tenninal official or truck operator 
requesting the access route(s) to furnish an appropriate S T.AA dimensioned test vehicle and 
driver for the purj'iose of observing the test vehicle traverse the requested access route(s). 



/::/ 6:16 \()RTH CAR()LL\A REGISTER November 15, 1991 



FINAL RULES 



(B) Since traffic safety is the overriding concern, the following safety factors shall also be taken 
into consideration in reviewing and evaluating a requested access route(s): 

(I) traffic congestion, 

(II) traffic volumes, 
(HI) route length, 

(IV) vehicle mix, 

(V) geometric design of the highway, 

(VI) intersection geometries, 

(VII) width of the shoulders, 

(VIII) width of pavement, 

(IX) superelevation of the pavement, 

(X) pavement condition, 

(XI) at-grade railroad crossings, 

(XI I) stopping sight distance, 

(XIII) percentage passing sight distance, 

(XIV) speed limits, 

(XV) vertical and horizontal alignment, 

(XVI) abihty of other vehicles to pass tnicks, 

(XVII) widths of bridges, 

(XVIII) previous accident experience, and 
(XIV) location of schools. 

This does not preclude consideration of their relevant safety factors, not included in Para- 
graph (2)(v)(B)(I) through (XIV). 

(vi) A route(s) used for the purpose of connecting two National Truck Network routes is con- 
sidered a "short-cut" route(s) and is not authorized by these Regulations. Such a route(s) may 
be considered for designation as an addition to the National Truck Network by the Department 
of Transportation under G.S. 20-1 15. 1(g). 

(vii) The State Traffic Engineer shall have a period of 90 days from receipt of any fully completed 
application pursuant to this Subparagraph (c) (3) (b) to approve or reject the applied for route(s) 
based on safety considerations and the review and evaluation process outlined in Subparagraph 
(c) (3) (e). Terminal official and truck operators requesting an access route(s) and appropriate 
law enforcement officials will be notified of ;my approval or rejection and the reasons. Auto- 
matic approval of a requested access route(s) is provided if such notification is not received 
within the 90 day period. 

(d) The Department of Transportation shall notify appropriate State and local law enforcement of- 
ficers of an approved "reasonable access" route(s) that serves each terminal within the jurisdic- 
tion of the enforcement agency. The State 1 raffic Fingineer shall also make available to terminal 
officials and commercial motor vehicle operators information regarding reasonable access to and 
from the National Truck Network. 

(e) The Department of Transportation may, at any time subsequent to approval, revoke any routes 
as a "reasonable access " route(s) based on safety considerations. Terminal officials, truck op- 
erators, and appropriate law enforcement officials will be notified in writing 30 days prior to any 
revocation. 

(f) Any S'T/V\ dimensioned veliicle travehng an access route(s) shall have on board an appropriate 

cargo manifest. 

(g) Approval of an access route(s) for one particular type ST/VA dimensioned vehicle shall constitute 
appro\'al for all ST/V-\ dimensioned vehicles for access purposes only. 

(h) Appeal - A terminal official, truck operator, or an appropriate law enforcement official may 
appeal the nilings concerning an access route(s) made by the State TrafTic Engineer to the Sec- 
retary of Transportation. In giving notice of appeal, the documentation to support reasons for 
believing that the determination of the State Traffic Engineer was erroneous shall be provided. 
The decision of the Secretary of Transportation shall be the final agency decision. 

Histoiy Sole: StaluUny Authority G.S. 20-115.1; 136-18; I43B-350; 
Board of Tran.sportation Minutes for Aovember J 8, 1988; 
Eff November I. 1991. 

SECTION .0600 - SELECTrV E VEGETATION REMOVAL POLICY 



6:16 NORTH CAROLINA REGISTER Novcmhet 15, 1991 1222 



FINAL RULES 



.((602 RI:QL ESTS FOR PERMITS 

(a) Applications for selective vegetation thinning, pruning, or removal (exclusive of grasses) shall be 
made b_\ the owner of the business or advertisement to the appropriate Division Engineer of the North 
Carolina Department of Transportation, Division of High\va\s. 

(b) Selecti\'e vegetation thinning, pruning, or remosal will be permitted only for the permittee's fa- 
cilities adjacent to high\va\' nght of way at locations where such facilities ha\'e been constructed. The 
provisions will not be used to provide visibiUty to undeveloped property. 

(c) Applications must be accompanied by a sketch showing the requested Imiits of the selective 
thinning, pruning, or removal of vegetation. For outdoor advertising displays, these limits shall be re- 
stricted to a maximum of 125 feet, in each direction, measured along the highway nght of way Une, from 
the center of the ad\ertising display. For commercial, industnal, mstitutional and office facilities, the 
limits of selective clearing or thinning shall be restricted to the area of right of way immediately adjacent 
to frontage property of the facility, but not to e.xceed 1.000 Unear feet. 

(d) Applications for permits for vegetation cutting to be performed on State Highway right of wav 
must be accompanied by written authori2ation(s) by the underl_\ing fee o\\ner(s) of all propert>- upon 
which cutting is to take place, provided that where the right of way was secured in fee simple by the 
Department, such authorization wiU not be required. The appU'cation must also be accompanied bv 
written authorization of all owners of property abutting the area to be cut. 

(e) I'he selective vegetation control request will be investigated on site by .Maintenance and Roadside 
Environmental personnel and a representative of the appUcant. 

(f) If the application for vegetation cutting is for a site located w ithin the corporate limits of a City 
or Tow n. local olTicials will be given the opportunitv to rev iew the application if the City or 1 own has 
previously advised the Div ision Engineer of therr desire to review such applications. 

Histoij Sole: Filed as a Temporary Rule Fff. April 13, 19S2. 

for a Period of 4S Days to Expire on June 1 , I9S2; 

' Staiuton- Auihoriiv G.S. I36-1S(5): I36-IS{''i: 136-I8i9j: 

Fff. June I. 1 982; 

Amended Fff Xovember I. 1991: December I, 1990; 

August L 19SS: June 2. 19S2. 

.0603 ISSl ANCE OR DENIAL OF PERMIT 

(a) Within 30 days following receipt of the application, the Division Engineer will approve or deny 
the application. If the apphcation is denied, the Division Engineer shall advise the applicant, in writing, 
of the reasons for denial. 

(b) The application will be denied bv the Div ision Engineer if: 

( 1 1 It requires removal of trees that were in existence before the business or advertisement was es- 
tablished unless the applicant submits an approved plan for replacement plantings. An exi>ting 
tree shall be one that is four inches in diameter as measured six inches from the ground. 

(2 1 The application is for the opening of view to a sign or business which has been declared illegal 
or is currently involved in litigation. 

(3) It is determined that the facility or advertisement is not screened from view. 

(4) The application is for the opening of view to an outdoor advertising sign which was obscured 
from view at the time of erection of the sign. 

(5) Removal of vegetation will adversely affect the safety of the travehng pubUc. 

(6) Trees, shrubs, or other vegetation of any sort were planted in accordance with a local. State 
or Federal beautification project. (Exceptional conditions mav' dictate a replacement, relocation 
trimming, or pruning of this planted material.) 

(7) Planting was done in conjunction with a designed noise barrier. 

(S) The applicant has not pertbmied satisfactor,' work on previous requests under the provision; 
of this policy (this may not be cause for denial if the apphcant engages a qualified firm to per- 
form the work). 

(9) It involves opening of views to junkvards. 

(10) The application is contrary to ordin;mces or rules and regulations enacted bv local government 
within whose jurisdiction the work has been requested to be pertbrmed. 



Histoij Sole: Filed iis a Temporary Rule Fff April 13, 19S2: 

for a Period ofJS Days to Fxpire on June L 1982: 
'Statutory Authority G.S. 136-/8(5,1: J36-I8(''i: 136-18(9); 



1223 6:16 .\ORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



Eff. June I, I9S2; 

Amended Eff. Sovember I, 1991 ; December 1 , 1990; 

August I, 1985; June 2, 1982. 

.0604 CONDITIONS OF PERMIT 

(a) Selected vegetation within the approved limits shall be thinned, pruned, or remo\ed by the 
Permittee or his agent in accordance with accepted horticultural practices. Roadside Fnvironmental 
personnel will identify specific trees, shrubs, etc., which may be pruned, thinned, or removed. Selected 
individual plants to be removed will tlrst be undergrowth or those which are dead, diseased, disfigured 
or otherwise lacking aesthetic quality. Removal of selected plants which are crowded and cannot fully 
develop in their existing locations may be the second stage of removal, if warranted. 

(b) The Permittee may be required to furnish a pertbrmance bond or check in an amount determined 
by the Division Engineer to run concurrently with the permit, as deemed necessary. 

(c) A Division of Highways Roadside Inspector shall be present while work is underway. 

(d) Permits may be issued for multiple sites; however, a permit must be secured prior to performing 
any vegetation control work. Routine maintenance by the Permittee or his agent vvUl not be permitted. 

(e) The Permittee or his agent shall not impede traffic on the highway in performing the work. Ac- 
cess to the work site on controlled access highways must be gained without using the main travelway 
of the highway. The Division Engineer will determine traffic control signing which may be required. 
It shall be the Permittee's responsibiUty to furnish, erect and maintain the required signs as directed by 
the Division Fngineer. 

(f) .Any damage to vegetation which is to remain, to higliway fences, signs, paved areas, or other fa- 
cilities shall be repaired or replaced by the Pennittee to the satisfaction of the Division I-nginccr. All 
trimmings, laps, and debris shall be removed from the right of way and disposed of in areas provided 
by the Permittee. No burning or burying shall be permitted on the higliway right of way. When 
chipping is used to dispose of trimmings, chips may be neatly spread on right of way at locations ac- 
ceptable to the Division Fngineer. 

(g) Upon satisfactory completion of all work, the Roadside Inspector shall notify the Division Engi- 
neer who will notify the Permittee in writing of such acceptance, tenninate the permit, and return the 
performance bond or check. 

(h) Failure to comply with all the requirements specified in the permit, unless otherwise mutually 
resolved, will result in immediate revocation of the pennit and forfeiture of any or all of the perform- 
ance bond or check as determined by the Division Fngineer. 

History Note: Eiled as a Temporary Rule Eff April 13, 1982, 

for a Period of 48 Davs to Expire on June 1 , 1982: 
Statutory Authority G.S. 136-/8(5): 136-I8{7); I36-I8i9l; 
Eff June f 1982; 

Amended Eff November I. 1991; August I. 1985; 
August I, 1982; June 2, 1982. 

SECTION .0700 - PROFESSIONAL OR SPECIALIZED SERVICES 

.0701 EMPLOYMENT OF PROFESSION.\L/SPECIALIZED FIRM: ALTlIORIZ.VriON 

(a) The State I lighway Administrator as conferred by law and delegated or prescribed by the Secretary 
or Board of Transportation has the authority to enter into and execute contracts with any pri\'ale 
agency, firm or individual to provide professional engineering services or other kinds of professional 
or specialized services in connection with higliway construction or repair. 

(b) Ihe managers of Highway Design, Planning and Research, Traffic Engineering, Right of Way, 
Construction and Maintenance Branches, arc delegated the authority by the State Highway Adminis- 
trator to enter into and execute contracts with any private agency, firm or indi\idual to provide pro- 
fessional engineenng services or other kinds of professional or speci;dizcd services in connection with 
highway construction or repair which shall be awarded in accordance with pro\ isions of this Section 
and G.S. 136-28. 1(f). 

(c) The employment by contract of any agency, firm or individual may be authorized and executed 
by any of the branch managers hstcd under any of the follow ing conditions: 

(1) The required work necessitates engineering or professional expertise and services not available 
on the staff of the department; or 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1224 



FINAL RULES 



(2) 'I'he required work can be accomplished more effectively, more efficiently, and more econom 
ically than by stall of the department: or 

(3) The required work cannot be undertaken and accomplished by the staff of the department in 
time to meet the established schedule for de\'elopment of the project; or 

(4) An emergency situation exists which requires expedient action to alleviate or minimize a condi- 
tion representing a danger or economic loss to the public; and 

(5) Such employment shall not be considered when other agencies of the state which have staff with 
the necessary expertise are available to accomplish the required work in a satisfactory manner 
on a schedule and at a cost suitable to meet the department's requirements. 

History Sole: Filed as a Femporary Rule Fff. June II, I9H2, 

for a Period of 51 Days to Expire on August I , I9S2: 

Statutory Authority G.S. 136-28./ (f); l43B-350(f)( 13 ) and (gj; 

Eff August /, /9S2; 

Amended Eff October I. 1991; April I. 1986; 

February 1. 1983. 

.0702 SOLICI lA HON AND AW ARD OF CONTRACT 

(a) The department shall establish and maintain a "Register of I'irms" which ha\e the necessar.' ex- 
pertise and experience and have expressed a desire to perform for the department professional engi- 
neering or other kinds of professional or specialized services in connection with highway construction 
or repair. F'requalification pursuant to 1'5A NCAC 2D .0801 is not required for inclusion on the 
"Register" or award of a contract under this Section. 

(b) Ipon authorization to use a professional. specialized firm, a Selection Committee shall be estab- 
lished by the branch manager consisting of at least three members who are experienced in the type of 
services to be contracted. For contracts anticipated to e.\ceed ten thousand dollars (} 10,000) solicita- 
tion for proposals will be by published advertisement, except for supportive services contracts. In ad- 
dition, solicitation for interest may also be by direct mail to several firms selected from the register. 
North Carolina firms qualified to do the required work shall be gi\en priorit\ consideration. A North 
Carolina firm is a firm which maintains an office in North Carolina which is permanently stalled and 
capable of pertbrming a large portion of the work required. 

(c) The flrm(s) to be employed shall be selected for each project by the Selection Committee. 

(d) f-'or contracts having a total cost over ten thousand dollars ($10,000) and for amendments thereto 
award shall be made by the Board of Transportation after consultation with the .Vdvisory Budget 
Commission. 

(e) Contract amendments which increase a contract cost to ten thousand dollars ($10,000) or more 
require appro\als as specified in Paragraph (d). 

(f) In an emergency situation, these Rules and Regulations may be waived b\' the State Ilighwav 
Administrator pursuant to G.S. 136-28. 1(e). .\ qualified firm may be selected, negotiations conductec 
and a contract executed by the State Highway Admimstrator as required to resolve the emergency 
conditions. 

(g) A noncollusion certification shall be executed by prime contractors and lower tier participants ir 
each transaction invoking public funds. Transactions which require certifications from lower tier par 
ticipants are: 

(1) Transactions between a prime contractor and a person other than for a procurement contract 
for goods or services, regardless of tvpe. 

(2) Procurement contracts for goods and services, between a prime contractor and a person, re 
gardless of type, expected to equal or exceed the P^ederal small purchase threshold fixed at 1 
C.S.C. 2304(g| and U.S.C. 253(g) [currently twenty-five thousand dollars ($25,000)] under 
prime contract. 

(3) Procurement contracts for goods or senices between a prime contractor and a person, regardles 
of the amount under which that person will have a critical influence on or substantive contro 
o\er the transaction. Such include, but are not limited to, bid estimators and contract managers 

The certifications for both the prime contractor and the lower tier participants shall be on a font 
furnished by the Department of Transportation to comply with federal Highway Administration re 
quirements, as pubHshed in 49 C.F.R. Part 29. The prime contractor is responsible for obtaining th' 
certifications from the lower tier participants and is responsible for keeping them as part of the contrac 
records. 



1225 6:16 NORTH CAROLINA REdlSTER November 15, 1 99 1 



FINAL RULES 



History Note: Filed as a Femporary Rule Fff. June II, 1982, 

for a Period of 51 Days to Fxpire on August I, 1982; 

Statutory Authority C.S. 136-28.1 (f); 

143B-350(f)(l3) and (g); 

Eff August 1, 1982; 

Amended Eff October 1, 1991: April 1. 1986; 

Fcbmaty 1, 1983. 

SECTION .0800 - SOLICITATION OF CONTRIBUTIONS FOR 
RELIGIOUS PURPOSES AT REST AREAS 

.0801 PERMIT TO SOLICIT CON IRIBUTIONS 

In recognition ot the State of North Carolina's legitimate concern for the safety and well-being of the 
traveling public as well as the right of citizens to the free exercise of religion, all religious organizations 
and those non-profit charitable or educational organizations with a histor>' of concern for the health 
and safety of the traveling public are hereby authorized to solicit contributions at North Carolina 
Highway rest areas, wayside parks, and visitor welcome centers in accordance with these Regulations. 
AH other forms of solicitation by any other individuals or organizations are prohibited. 

History Note: Statutory Authoritv G.S. 20-175: 136-18: 
Eff. November 1. 1984: 
Amended Eff October I, 1991: August 1, 1986. 

.0802 PERMITS REQl IRED 

(a) /\11 organizations desiring to solicit under the provisions of this Section must first obtain a permit 
from the Department of Transportation for the stated purpose of allowing their members to solicit at 
designated areas on the state highway system. 

(b) Written requests for permits for solicitation shall be sent to the appropriate Division Engineer of 
the Division of Highways m which the rest area or welcome center is located. 

(c) Written requests must include all of the following: 

(1) copy of certificate showing that the applicant is e.xempt from federal income tax as a religious, 
educational or charitable organization as pro\idcd in 26 USC 501(c)(3) together with the appli- 
cant's tax exemption number; 

(2) a statement indicating the locations where the organization intends to solicit contributions; 

(3) the name and address of each individual authorized to sohcit for the apphcant; 

(4) the name of an oflicer of the applicant, together with an address, to w hom the permit is to be 
sent and complaints are to be directed; 

(5) if the request for a permit is from a non-rehgious educational or charitable organization, a de- 
tailed written description of the organization's past efforts ser\ing and promoting the safety of 
the traveling public. 

(d) When aU the appropriate information required in Paragraph (c) of this Rule has been provided 
by the applicant, a pennit shall be issued by the state highway administrator, or his duly authorized 
representative, and said permit will be effective for a period of 30 days from the date of issuance. 

(e) Each permit issued shall describe the activity authorized, the area in which it may be conducted, 
and the period of time for which the permit is issued. 

History Note: Statutory Authority G.S. 20-175: 136-18: 
Eff November 1, 1984; 

Amended Eff October 1, 1991: September 1. 1986: 
August 1, 1986: September 1, 1985. 

.0803 SOLICn ATION RESTRICTIONS AND REQLIREMENTS 

(a) i\ny member of an organization duly permitted under these Regulations actually engaged in so- 
liciting for contnbutions must provide and prominently display an identification tag or badge containing 
all of the following information: 

(1) a photograph; 

(2) name; 

(3) organization; and 

(4) DOT pennit number. 



6:16 NORFH CAROLINA REGISTER November 15, 1991 1226 



FINAL RULES 



(b) While actually engaged in the solicitation of contnbutions, individual solicitors shall orally identify 
themseh'cs and state which organization they represent. 

(c) Indi\idual sohcitors operating under a permit from the department shall be permitted to engage 
in their solicitation activities only between the hours of 9:00 a.m. and 5:00 p.m. each calendar day ex- 
cept during hohdays, when a different time is authorized in the permit. 

(dj lndi\idual solicitors are prohibited from soUciting on any portion of a highway not designated 
as a rest area or welcome center. 

(e) The area of the rest area which may be used shall be clearly specified in the permit, and shall not 
impede visitors' access to rest facilities. At the same time, it should provide reasonable visibihty of the 
soliciting group when feasible. 

(f) Individual solicitors may use incidental water and electric utility services at highway rest areas or 
visitor centers with connections at locations approved by the Division of Highw-ays. 

(g) A permittee shall be Umited to one individual sohcitor actually engaged in sohcitation activities 
at each site, and this individual may have the assistance of no more than two other members of the 
permittee's organization. 

(h) lndi\idual sohcitors shall not persist in soliciting after sohcitation has been declined, and solicitors 
shall not soUcit State employees who are identifiable as such. 

(i) Indisidual solicitors shall not harass persons by demanding, threatening or intimidating conduct. 

(jl While indi\idual sohcitors may solicit from the general public donations for printed matter, 
refreshments or religious paraphernalia, the indi\ idual solicitors must inform the person solicited if a 
mmimum donation is required. 

(kj rVU distribution of refreshments, pamplilets and other materials and or transfers of mone\' or funds 
solicited from a person acting pursuant to a permit issued by the State Highway Administrator or his 
duly authorized representative, shall take place in or at location speciticaUy identified in the permit. 

(1) Indi\idual sohcitors may not engage in dancing, chanting, the use of music or other noise 
producing mstrumcnts, megaphones, microphones or any other similar de\ices. 

(m) Indi\ idual solicitors shall cease acti\ities in the event of emergency situations invoK'ing dangers 
to the general pubhc. 

(n) Individual sohcitors shall not intertere with pedestrian or \-ehicular traffic. 

(o) No more than two organizations, one rehgious and one non-rehgious charitable or educational, 
may sohcit at highway rest areas, wa\side parks or \isitor welcome centers at the same time. 

Hisioiy Sole: Statutoty Auihoritv G.S. 20- J 75: 1 36- IS: 
Eff. November I. 1984: 

Amended Eff. October I. 1991: August I. 1986; 
September I. 1 985. 

SEC HON .0900 - DISTRIBIIION OF NK\\SPAPKRS FROM DISPENSERS AT REST 

AREAS AND \NTI.COME CENTERS 

.0901 NEWSPAPER DISTRIBL TION POLICY 

'I he Department of Transportation, in recognition of the I'irst /Vmcndment nglit of freedom of speech 
which includes the right to distribute newspapers in certain pubhc areas, and in recognition of the State 
of North Carolina's legitimate concern for the safety and well-being of the tra\eling public and the 
commercial \endmg authority of the Division of Ser\ices to the Blind, Department of Human Re- 
sources, has determined that all distribution of newspapers at rest areas and welcome centers on all of 
North Carolina's highways shall he in accordance with the following Rules. AU other forms of news- 
paper distribution at rest areas and welcome centers are prohibited. 

Histon Sote: Statutotr Authoritv G.S. 111-41 el seij.: 136-18(9): 
Eff October I. 19'h. 

.0902 PERMEIS REQl IRED 

fa) A pennit must be obtained from the Department of Transportation to distribute newspapers trom 
newspaper dispensers at rest areas and welcome centers. 

(b) AU permit requests must be in writing and must include the ovsner's name, address, telephone 
number and location of the newspaper dispenser, a plot plan showing the proposed location ot the 
newspaper dispenser and a certification that such location is in confomiity w ith this Section. The filing 



122^ 6:16 AORTH CAROLINA REGISTER November L\ 1 99 1 



FINAL RULES 



of a completed permit application will be considered a temporan, peimit pending the 30 day IX'part- 
ment of Transportation review in Paragraph (c) of this Rule. 

(c) Within 30 days of receipt of the permit application, the Department of Transportation will review 
the proposed location and, if it meets all requirements, issue a permit. If the application does not meet 
all requirements, the Department shall issue a notice of nonconformance and list the reasons the ap- 
plication does not conform to the Department Rules. 

(d) I he permit shall be valid until terminated or revoked for noncompliance with these Rules. 

Ifiuon- Sole: Statutory Authoritv G.S. 136-18(9); 
Eff. October I. 1991. 

.0903 indkmmucahon 

(a) The owner of the news dispenser, upon the placement of a new spapcr dispenser at a rest area or 
welcome center, assumes the unconditional obligation and thereby agrees to defend, indemnify and save 
harmless the State, its agents, servants and employees from all suits, actions or claims of any character 
broudit because of death or any injun received or sustained by negligence of State employees or agents, 
ansing out of the installation, use or mamtenance of any newspaper dispenser located on State higjnvay 
rest areas or welcome centers, or where such suit, action or claims arise out of such installation, use 
or maintenance of any newspaper dispenser being a contributing omission, neglect or misconduct by 
the pcmiittee, or its employees, agents, distributors or servants relating to the installation, use or 
maintenance of any newspaper dispenser w ithin the State highwa\' rest areas or welcome centers. 

(b) The aforesaid indemnification pro\ision shall be contained in each pennit issued by the Depart- 
ment pursuant to this Section. 

Ilhtorv Sate: Statutory Aulhoritv G.S. 136-18(9): 
Eff. October I. 1991. 

.0904 LOCATION, INSlALIATION AND MAIM KNANC K/M W SPAPI.R DISPINSKR-S 

Any newspaper dispenser which in whole or in part rests upon, in or over rest areas or welcome cen- 
ters shall comply with the following standard: 

(1) Newspaper dispensers shall not exceed fne feet in height, 36 inches in width, or 30 inches in 
depth; 

(2) Newspaper dispensers may be chained or otherwise attached to one another; however, no more 
than three newspaper dispensers may be joined together in this manner, and a space of no less than 
18 inches shall separate each group of three newspaper dispensers so attached. 

(3) No newspaper dispenser shall be used for advertising signs or publicity purposes other than that 
dealing with the displa\', sale or purchase of a newspaper or periodical sold therein. 

(4) Fveiy newspaper dispenser placed at a rest area or welcome center shall have affixed thereto in 
a place where such information may be easily seen, the name, address, and telephone number of 
the owner and person (if different from the owner) responsible for maintaining the news dispenser. 

(5) No newspaper dispenser shall be chained, bolted or otherwise attached to any public fixture lo- 
cated within the State higliwa\" riglit of way, including, but not limited to, official signs, sign sup- 
ports, guide rails, traffic signal supports, highway lighting supports, controller boxes, tire hydrants 
or bus shelters. 

(6) Newspaper dispensers shall be securelx' place so as to reasonably prevent personal injuiy or 
property damage due to tilting, tipping or overturning. 

(7) Even,' newspaper dispenser shall be maintained so that: 

(a) \X is reasonably free of dirt and grease. 

(b) h is reasonably free of chipped, faded, peeling and cracked paint; 

(c) It is reasonably free of nist and coiTosion: and 

(d) The structural parts thereof arc intact. 

(8) No newspaper dispenser shall be within five feet of a fire h\'drant, fire call box. police call box 
or any other emergency facility. 

(9) No newspaper dispenser shall be placed in lobbies of rest areas or v\clcome centers or along the 
sidewalk on the approach to the rest area or welcome center building. Newspaper dispensers also 
:ire not allowed under the roof overhangs of these buildings. 

(10) No newspaper dispenser shall be placed in such a way that it impedes \'ehicular, pedestrian or 
handicapped person movements on drive and walkwa\s, at telephones, trash receptacles, water 
fountains, to and fVom picnic areas or to and from rest area and welcome centers ser\ ice buildings. 



6:16 NORTH C.AROLIN.A REGISTER November 15, 1991 122S 



FI^AL RULES 



(11) No newspaper dispenser shall be placed along the curbs adjacent to parking areas. When a news 
dispenser is placed along a sidewalk it shall be placed parallel to and no more than six inches from 
the sidewalk edge farthest from the traffic curb. 

(12) Where \ ending facilities are in existence at rest areas or welcome centers, the newspaper 
dispensers shall be placed in close proximity to those buildings. 

(13) Where \'ending facilities are planned at a rest area or welcome center, the newspaper dispensers 
shall be placed near the planned location oi the \ending facility. 

Uisioiy Sole: Statuton; Authoritv OS. I36-IS{9): 
Eff. Oaober I. IWI. 

.(W(t5 ( ONDII IONS, NO nCE OF \ lOI. AIIONS AND AI'PKALS 

(a) I he continued placement, use and maintenance ot nev\spaper dispensers is conditioned upon 
compliance with aU the provisions of this Section. If any of the pro\ isions of this Section are alleged 
to have been violated or if the location, installation, or condition of the newspaper dispenser no longer 
meets with the specifications of tliis Section the permittee shall be notified of the non-comphance by 
registered mail, return receipt requested. 

(b) The notice shall state the specitic pro\'ision(s) of this Section which are alleged to have been vi- 
olated. 

(c) The notice shall further state that, upon request by the permittee within 15 days of the receipt of 
said notice, the official issuuig the notice of \iolation shall meet with the permittee to discuss the basis 
for the determination that a violation exists and any proposed means of eliminating any violations. 
That meeting shall take place within 30 days of said rccjuest. .A rec]uest for such a meeting shall stay 
the further enforcement of this Section, except in emergencv' situations. Following any such meeting, 
the official issuing the notice of violation may rescind the notice if it is determined that there was no 
violation or in the event the alleged violation is otherwise eliminated. I he otficial may also grant time 
for the correction of anv' violation upon request. 

(d) If. within 30 days after mailing the notice of non-compliance, or within 30 days after the meeting 
referred to m Paragraph (c) of this Rule, m the event a meeting is requested and docs not resolve the 
dispute in a mutuaUv' acceptable manner, or the permittee has failed to remove the newspaper dispenser 
or otherwise correct the violation or reason for non-comphance, the permit shall be revoked and the 
pemiittee shall be notified by registered mail that the permit has been revoked. 

(e) The decision as provided for in F;iragraph (d) of tliis Rule shall be in the final agency decision. 

(f) If the pcnnittee (or appUcant where no permit has been issued) fails to appeal from the revocation 
of a permit or a decision not to grant a permit, and does not remove or have removed the ncv\spapcr 
dispenser in cjuestion within 30 days from the receipt of a revocation notice, the newspaper dispenser 
shall be removed b\ the Department of Transportation maintenance personnel and stored at a De- 
partment of Transportation maintenance yard. The pcnnittee shall be notified bv registered mail ot the 
location of the new spaper dispenser and the hours when it may be obtained. The Department of 
Transportation shall not be liable for any damage to the newspaper dispenser, to any material contained 
therein, or for any lost sales caused by the removal, transportation or storage of the newspaper 
di^penser. 

l/lsioiy .\oic: Statuion' Authority (7.5. I36-IS(0 1: 
F.ff. October I, 1991. 

.(•9(16 compi.iancf: wnu di\ of sfrmcfs for riiF hfind rfqi irfmfn fs 

Fennittees must complv with the requirements of the Division of Services tor the Blind, Department 
ot Human Resources, as the State licensins aeencv designated pursuant to Section 2(a)(5) ot the 
Randolph-Shcppard Act |20 USC 107a(a)(5)lT 

lliston .\otc: Statuton Authority G.S. 111-41 ct seq.: /36-/S('9l; 
Eff. October /. I99L 

CHAFFFR 3 - Dl\ FSION OF MO lOR \ FHICFKS 

SrB( MAPTFR 3A - ADMINIS IRA FION 

SECTION .(1100 C.FNFRAF ADMINFSTRATION 



1229 6:16 SORTH CAROLINA RECISTER Sovember 15, 1991 



FINAL RULES 



.0101 ORGANIZATION: COMMISSIONER OF MOTOR VEHICLES 

The current organization of the Division of Motor Vehicles consists of six operating sections: Driver 
License, Vehicle Registration, Enforcement Collision Reports/General Services, School Bus and Traffic 
Safety, and International Registration Plan (IRP). The administrative unit consists of the Commis- 
sioner, Deputy Commissioner, three Assistant Commissioners, and the Special Assistant to the Com- 
missioner for Citizen Affairs. 

History Note: Statutory Authority G.S. 20-J; 20-3; 
Eff. July I. 1978; ' 
Amended Eff. November 1 , 1991 ; Eebruary I, 1982. 

SECTION .0200 - .MOTOR CARRIERS OF MIGRATORY FARM WORKERS 

0201 DEFINITIONS 

0202 QUALIFICATIONS OF OPERATORS 

0203 DRFV TNG OF MOTOR VEHICLES 

0204 ACCESSORIES NECESSARY FOR SAFE OPERATION 

0205 HOURS OF SERMCE OF DRIVERS: MAXIMUM DRIVING TIME 

0206 INSPECTION AND MAESTENANCE OF MOTOR VEHICLES 

0207 LIGHTESG EQUIPMENT 

0208 BRAKES 

0209 WARNING DEVICES 

0210 EMERGENCY EQUIPMENT: SUPPLIES: ETC. 

02 1 1 EXHAUST SYS I EM 

0212 FIRST AID EQUIPMENT AND SUPPLIES 

0213 REAR VIEW .MIRROR 

0214 STEERING .MECHANISM 

0215 DIRECTIONAL SIGNALS 

0216 WINDSHIELD WIPER: WTSDSHIELD: SIDE AND REAR GLASSES 

0217 PENALTIES: VIOLATION OF REGULAl IONS A MISDEMEANOR 

0218 MOTOR VEHICLES TRANSPORTESG MK.RAIORY FARM WORKERS 

History Note: Statutory Authoritv G.S. 20-1; 20-4.1; 20-7; 20-9; 20-/0; 
20-122.1; 20-124; 20-125.1; 20-l27(a),(c); 20-129; 20-131; 
20-J54(bJ; 20-2/5. J; 20-2/5.2; 20-2/5.4; 20-2/5.5; 
Eff July /. /978; 
Amended Eff. February / , /982; 
Repealed Eff. November / , /99/ . 

SUBCHAPTER 3B - DRFV ER LICENSE SECTION 

SECTION .0100 - GENERAL ESFORM.ATION 

.0103 FORMS 

The forms used by the dri\'cr license section of the Division of Motor Vehicles arc on fde in the 
commissioner's office and are available for review during normal working hours. 

History Note: Statutory .Authority G.S. 20-7; 
EffJulv/. /978; 
Amended Eff November /. /99/: June 5. /98/. 

.0119 FEE FOR DRIVER IMPROVEMENT CLINIC 

A twenty-live ($25.00) fee shall be charged to persons who are assigned and attend the driver im- 
provement clinic. Payment must be made to a driver license representative prior to attending the first 
class. A certified check, money order or cash will be required, and a receipt for pa>mcnt. in any fonn, 
will be issued. Personal checks will not be accepted. 



History Note: Statutory Aut/iority G.S. 20-/; 20-/6(c): 20-/6(e); 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1230 



FINAL RULES 



Eff. October I, 1982; 

Amended Eff. November 1 . 1991. 

SECTION .0300 - MEDICAL EVALL ATION 

.0301 ACUTE OR CHRONIC ILLNESSES 

(a) Certain illnesses such as uncontrolled epilepsy, diabetes, severe vision problems, certain forms of 
mental illness, alcoholism and others, may make driving unadvisable either temporarily or permanently. 
Drivers suffering from such an iUness may be referred to the Division for evaluation by any one of the 
following: 

(1) dri\er license examiner, 

(2) driver license hearing officer, 

(3) driver education specialist, 

(4) law enforcement officers, 

(5) court officials, 

(6) physicians, 

(7) citizens. 

(b) Reports of chronic lUncss wiU be evaluated by a Division of Health Services physician and may 
be reviewed by a panel of practicing physicians. The panel of physicians may recommend approval 
of the subject's driving privilege, approval with restrictions or disapproval. A driver receiving an un- 
favorable decision may appeal the decisions to the Medical Re\ iew Board. 

History Note: Statutory Authority G.S. 20-1; 20-9; 20-17.1; 
Eff July I, 1978; 
Amended Eff November I. 1991; June 5. 1981. 

SECTION .0400 - RECORDS 

.0403 DRIMNC. RECORDS 

(a) North Carolina G.S. 20-26(a) pro\'ides for copies of driver license records to be furnished, upon 
prepayment of the appropriate fee, to persons, firms or corporations for uses other than official. The 
record check wUl contain only public information concerning the subject of the driver license check. 
Collision reports are not public information and shall not be a part of the dnver license record check. 
Information on a specific collision may be obtained from the Collision Reports General Services Sec- 
tion of the Division of .Motor Vehicles, 1 100 New Bern Avenue, Raleigh, North Carolina 27697. 

(b) Under North Carolina G.S. 58-248.8 and in accordance with the Fair Credit Reporting Act, a 
motor vehicle record check will be provided in connection w ith the underwriting of insurance or upon 
written authorization of the consumer. The motor \ehicle record check will provide information as 
required by G.S. 20-26. 

Ifiston' .\ote: Statutorv Authority G.S. 20-1; 20-26ib).(cl: 
Eff July I. 1978; 
Amended Eff November I, 1991; July I, I9S2. 

SECTION .0600 - CLASSIFIED DRFS ERS' LICENSE 

.0601 GENERAL INFORMATION 

(a) Under G.S. 20-7(a). dnvers' licenses shall be classified by weiglit and t\pe of vehicle to be oper- 
ated. Section 40, Chapter 667 of the 1979 session laws authorizes the commissioner to adopt regu- 
lations as may be necessary to carry out the provisions of the Classified Dri\er License Act, including 
the establishment of regulations defining "Gross Vehicle Weight." 

(b) Where provisions of this Section .0600 (Classified Drivers' License) may be in contlict with the 
provisions of Section .0700 (Commercial Drivers' License) or those of 19A NC.-\C 3J (Rules and 
Regulations Governing the Licensing of Commercial Truck Dri\er Training Schools and Instructors), 
the provisions of Section .0700 and those of \9.\ NC.AC 3J will pre\ail. 

Uistoiy Note: Statutorv Authority G.S. 20-7; S.L. 1979, c. 667, s. 40; 
Eff June 5. 1981; 
Amended Eff November I. 1991. 



1231 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



SUBCHAPTER 3C - VEHICLE REGISTRATION SECTION 
SECTION .0100 - GENERAL EVFORMATION 

.0102 FORMS 

The forms used by Vehicle Registration to administer the functions described in Rule .0101 of this 
Subchapter are available from the Vehicle Registration Section of the Division of Motor Vehicles, 1 100 
New Bern Avenue, Raleigh, North Carolina 27697. 

History Note: Statutory Authority G.S. 20-1: 20-39: 20-41: 
Eff. Jidv I, I97S: 
Amended Eff. November I, 1991: February I, 1982. 

SECTION .0200 - REGISTRATION 

.0202 TITLING AND REGISTRATION OE BRANDED VEHICLES 

Upon application for title and registration of a motor vehicle as defined in G.S. 20-4.01(33), the fol- 
lowing regulations apply: 

(1) Flood vehicles will be branded "Water/Mood Damage Vehicle" on the title and "WA'IR-FID" 
on the registration card. 

(2) Non-U. S. A. vehicles may be registered with the brand "Non-U. S. A." printed on the card, but 
will not be titled unless and until documentary proof is received from the applicant showing that 
the vehicle has been modified to meet United States safety and emission control standards. Ihe 
title will then reflect the brand "Non-U. S. A. vehicle". 

(3) Reconstructed vehicles will be branded "RECONST" on the registration card and "Reconstructed 
vehicle" on the title. The application for title must be accompanied by the Inspector's report 
showing the vehicle was inspected prior to being rebuilt and was reinspected when completed, and 
the rebuilder's affidavit detailing the repairs made including proof of ownership of the parts used. 
Salvage vehicles not inspected prior to being rebuilt will be branded "Reconstructed vehicle." 

(4) Salvage vehicles will be branded "SAUVAGE" on the registration card and "Salvage vehicle" on 
the title. The apphcation for title must be accompanied by the Inspector's report to show the 
vehicle is operable and requires no repairs. 

(5) Salvage rebuilt vehicles will be branded "SAL-RBUT" on the registration card and "Salvage Re- 
built vehicle" on the title. The application for title must be accompanied by the Inspector's report 
showing the vehicle was inspected prior to being rebuilt and reinspected when completed, and the 
rebuilder's affidavit detailing the repairs made including proof of ownership of the parts. Failure 
to have the \ehicle inspected prior to repair will result Ln the vehicle being branded a reconstructed 
vehicle. 

(6) Junk vehicles are marked "Junked" on the registration records only. The title must be submitted 
indicating the vehicle is incapable of operation or use upon the highways and has no resale value. 

History Note: Statutor\' Authoritv G.S. 20-1: 20-39: 20-71.3: 20-109.1: 
Eff July I. 1978: ' 
Amended Eff November 1, 1991; January I, 1988. 

.0224 PURCHASE INFORMATION 

The following purchase information is required for the title apphcation: 

(1) The name and address of the person or firm from whom the vehicle was acquired; 

(2) The date of purchase and whether the vehicle is new or used; 

(3) Dealer's certificate number; 

(4) Whether the vehicle was acquired for use in North Carolina; 

(5) Purchase price, verified by bill of sale on new vehicle; 

(6) State of last registration; 

(7) Odometer reading and federal odometer statement; and 

(8) Ad valorem tax certification. 

History Note: Statutory Authority G.S. 20-1: 20-39: 20-52; 
Eff March I. 1982; 



6:16 NORTH CAROLINA REGISTER November L\ I99I 1232 



FINAL RULES 



Amended Eff. Sovember I. 1991. 

.0232 RFIGISIRAI ION INFORMATION AND CERTIFIED RECORDS FEES 

\'enfication of information from Division of Motor Vehicles records as to license numbers, ownership, 
or liability insurance requires a written request and fee of one doUar ($1.00) per record. Certified copies 
of these records are pro\ided for a fee of five dollars ($5.00) per document. 

Histor\- Sole: Statulor\' Aulhority G.S. 20-/; 20-39: 20-42; 
Eff. .March I. 1982; 
Amended Eff. Xovember I. 1991; December I, 1984. 

.0236 FENAETV FOR FAILURE TO MAKE TRANSFER WITHIN 28 DAYS 

The following are exempted from the requirement to make application for title within 28 days of ac- 
quiring a vehicle (G.S. 20-74): 

(1) licensed dealers; 

(2) transfer upon Lnherit;mce; 

(3) transfer by operation of law where confirmation of the sale is required; 

(4) transfer by the court (such as bankruptcy and confiscation); 

(5) dealers or repossessors when applying for title in their name; 

(6) out of state dealers reassigning North Carolina titles to North CaroHna purchasers. 

Historv Sole: Suimiory Aulhority G.S. 20-1; 20-39; 20-74: 
Eff March I. J9S2; 
Amended Eff. Sovember 1 , 1991 . 

SECTION .0300 - FINANCIAL RESPONSIBILITY 

.0303 TERMINATION NOTICES 

(a) North Carolina Notice of Termination Fonn I'S-4 is used to notify the Commissioner of the 
Di\ision of Motor \'ehicles of termination of motor \ehicle liability insurance. The fonn is supplied 
by the insurer and must include the name and address of the insured owner; year, make, and identifi 
cation number of the vehicle for which the notification is made; termination date of policy: inception 
date of policy; date of preparation of the FS-4. Notices of termination of policies covering multiple 
Ustcd vehicles require a Form FS-4. A schedule of vehicles on same policy may be attached to an rS-4 

(b) Insurers shall notify the Commissioner of the North Carolina ni\'ision of Motor Vehicles im- 
mediately upon the effective date of tennination, cancellation, or deletion of a motor vehicle from a 
motor \'ehicle liabihty insurance policy. Pro\ided, that notification to the commissioner is not neces- 
sary if a \ehicle is deleted from a policy and replaced with another vehicle or is insured under a fleet 
pohcy b\" the same insurer. A fleet policy is defined as a policy with \\\t or more vehicles which are 
not listed indi\idually by year, make, model or identification number. 

(1) The notification of cancellation, termination, or deletion of a \'ehiclc from a pohcy shall be on 
a form appro\ed by the Commissioner of the North Carolina Di\'ision of Motor \'ehicles. The 
form shall be designated as a FS-4 and shall reflect the following: 

(A) name and address of insured; 

(B) name of insurance company and code number; 

(C) Near, make and identification number of vehicle; multiple \'chicles on same pohcy may be 
attached to one FS-4; 

(D) termination date; 

(E) inception date; 

(F) date prepared: 

(G) signature or a facsimile signature, which may be pre-printed or stamped, of authorized rep 
resentati\'e of insurance company; 

(II) color: red: 

(I) size: 7" width x 4 1 4" height: and 

(J) must be typed or computer generated. 

(2) Insurers shall notify the Commissioner of the North Carolina Di\ision of Motor \'ehicles in the 
following instances: 

(.\) If a termination of liabihty insurance (FS-4) was issued to the North Carolina Division of 
Motor \'ehicles :md the insured was remstated or renewed, the insurer must immediatch" inform 



12.^3 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



the Division with an FS- 1 certificate of insurance, provided such reinstatement or renewal has 
occurred without any lapse in coverage. An agent representing an insurance company may issue 
the notification if authorized to do so by the company. 

(B) An agent representing an insurance company may issue notification if authorized to do so 
by the company. FS-l's should be issued upon request from the insured, Division of Motor 
Vehicles, or to reinstate with no lapse in coverage. 

(C) When an insurance company terminates a policy for whatever reason and issues another 
poUcy, without a lapse, no FS-4 is necessary. The insurance company shaU issue a FS-1 
showing continuous coverage. 

(3) The certificate of insurance notice shall be on a form approved by the Commissioner of the 
North Carolina Division of Motor Vehicles. The form shaU be designated as a FS-1 and shall 
reflect the following: 

(A) name and address of insured; 

(B) name of insurance company and code number; 

(C) year, make and identification number of vehicle; multiple vehicles on same policy may be 
attached to a FS-1; 

(D) policy number; 

(E) policy effective date; 

(F) date prepared: 

(G) signature or facsimile signature of authorized representative; may be pre-printed or stamped; 
(H) color: purple,red; 

(I) size; 7" width x 4 1,4" height; and 
(J) must be typed or computer generated. 

(4) Insurers may arrange with the Division of .Motor Vehicles for notices to be submitted through 
exchange of electronic data media. If this procedure of reporting is selected. Division of Motor 
\'ehicles wdl not have a\ailable a hard copy of submitted notices. 

History Note: Statulorv Authority G.S. 20-39; 20-279.2; 20-279.22; 20-279.29; 
20-309; 20-3/6; 20-316.1; 
Eff. July I, 1978; 

Amended Eff. .Wovember I. 1991: October I, I9S4: 
February I, I9S2. 

.0304 VERIFICATION OF CERTIFICATION 

(a) Turn-around forms requesting verification will be addressed to insurers by the Division of Motor 
Vehicles. 

(b) Insurers are required to respond to requests for certification within 15 days after receipt by the 
insurer. 

(c) The form completed by the Division of Motor Vehicles must contain: 

(1) vehicle owner's name and address; 

(2) vehicle make, model and vehicle identification number; 

(3) date certification was made by the registrant; and 

(4) date certification request was prepared by the Division of Motor Vehicles. 

(d) Data to be furnished by the insurer must include at least one of the following: 

(1) the vehicle is currently insured against liability; 

(2) the vehicle is not currently insured, but was insured at the time of certification; or 

(3) no record of any habiUty insurance is available for the vehicle described. 

Histon> Note: Statutory Authority G.S. 20-39; 20-279.2; 20-316.1; 
Eff July I. 1978; 
Amended Eff. November 1 , 1991 ; February /, 1982. 

SECTION .0400 MOTOR \ EHICI.ES OPERATED FOR-HIRE 

.0417 SALES TAX 

History Note: Statutory- Authority G.S. 20-39; 105- J 64.4; 105-164.6; 
Eff. March 1, 1982; 
Amended Eff October 1. 1984; 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1234 



FINAL RULES 



Repealed Eff. Sovember I, 1991. 

.0427 PERSONALIZED PLATES 

The following regulations are in addition to the law as set forth in G.S. 20-81.3: 

(1) Personalized plates will transfer from one vehicle to another if the vehicles have the same owner. 

(2) The twenty doUars ($20.00) paid for a special plate cannot be refunded after the order for the 
plate's manufacture has been given. 

History Xote: Statutory Authority G.S. 20-39; 20-SI.3: 
Eff. March I. 1982; 
Amended Eff. Sovember 1, 1991. 

.0436 HIGmVAY USE TAX 

(a) Highway Use Tax is collected on all sales of new and used motor vehicles at the time application 
for title is made. 

(b) Vehicles purchased from a dealer are taxed on the sales price less any trade credit. 

(c) Used \ehicles are taxed on the DMV computer value which does not exceed wholesale value. 

(d) Mobile homes are not subject to Highway Use Tax. 

Historx' Xote: Statutory- Authority G.S. 105-IS'^.I through 20- 18'^. 10; 
Eff. Sovember I. 1991. 

I 

SECTION .0600 - INTERNATIONAL REGISTRATION PLAN 

.0601 GENERAL INEOR.M.ATION 

Historx \ote: Statutory Authority G.S. 20-86. f- 20-91 ; 
Eff March 1, 1982; 
Repealed Eff. Sovember 1 . 1991 . 

.0602 OBTALSESG I.R.P. M.\NUAL .\ND SCHEDULE FORMS 

llistorv Sote: Statutory Authority G.S. 20-86.1; 20-91; 
Eff February I, 1982; 
Repealed Eff Sovember I. 1991. 

.0603 REGIS IRAIION UNDER THE INTERNATIONAL REGISTRATION PLAN 

History Sote: Statutory Authority G.S. 20-86.1; 20-91; 
Eff .March 1. 1982; 
Repealed Eff Sovember 1. 1991. 

SUBCHAPTER 3D - ENEORCE.MENT SECTION 

SECTION .0600 - WEIGHT OF \ EHICLE AND REGISTRATION ENFORCEMENT 

.0603 WTIGHESG \ EHICLES \MTH PORTABLE SCALES 

History Sote: Statutory Authority G.S. 20-1; 20-118.1; 
Eff July 1, 1978; 

Amended Eff February 1. 1985; Februan 1. 1982; April 11. 1980; 
Repealed Eff Sovember 1, 1991. 

SECTION .0700 - APPRO\ AL OF MOTOR A EHICLE SAFETY EQUIP.MENT 

.0701 \ EHICLE EQUIPMENT APPRO\ AL 

(a) The Enforcement Section is responsible for issuing certitlcates of appro\al for all motor vehic 
satety equipment that requires the approval of the Commissioner of Motor Vehicles. 



1255 6;I6 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



(b) Anyone wishing to know if an item requires the commissioner's approval may contact this office 
for the information. 

(c) If the equipment requires the commissioner's approval, and an individual wishes to know if a 
particular brand name item is approved, he may also contact this office for a listing of approved man- 
ufacturers of this piece of safety equipment. 

History Sole: Statutory Authoritv G.S. 20-1: 20-l24(f).(h); 20-I25(a) through (c); 
20-125. 1(a),(b): 20-l26(a) through (c); 20-l27(b); 
20-l29(a) through (d).(f),(g); 20-I29.I (7),(8); 20-l30(a); 
20-l3I(a) through (d): 20-l35(c); 20-135. 1(a); 20-l35.2(a),(b); 
20-135.3; 20-137. 1(a); 
Eff. Februarv I. 1982; 
Amended Eff. .Xovember I. 1991: August I, 1982. 

.0702 INFOR.M.ATION FOR MANLFACTLRER 

A manufacturer of salety equipment requiring approval should contact the .Vmerican Association of 
Motor Vehicle Administrators, 4200 Wilson Boulevard, Suite 600, j-Vrlington, Virginia 22203, for ap- 
proval procedures. Additional information on motor vehicle safety equipment may be obtained from 
the Enforcement Section or the Commissioner of Motor Vehicles' office during normal office hours. 



History S'ote: 



Statutory Authority G.S. 20-1; 20-1 24(f),(h); 20-l25(a) through (c); 
20-125. l(a).(b); 20-I26(a) through (c); 20-l27(b); 
20-l29(aj through (d),(f).(g); 20-129.1 (7),(8j; 20-I30(a); 
20-l3I(a) through (d); 20-l35(c): 20-135. /(a); 
20-l35.2(a): 20-/35.3; 
Eff February I, 1982; 
Amended Eff .Xovember I, 1991 . 

.0703 REQl IRED LIGHTING EQUIPMENT FOR HOUSE TRAILERS 

Ever)' house trailer, mobile home, modular home, or structural component thereof shall be required 
to have certain rear lighting equipment while the vehicle is in intrastate transit. The hghting equipment 
may be attached by means of a harness removable upon completion of transit. Information on the 
required hghting equipment may be obtained from the Enforcement Section, and is on fde in the 
Commissioner of \lotor Vehicles' office for inspection and review. 

History Xote: Statutory- Authoritv G.S. 20-/; 20-/29.2; 
Eff February /, /9S2: 
Amended Eff. Xovember / , /99I . 

SECTION .0800 - SAFETY RULES AND REGUL.ATIONS 

.0801 SAFETY OF OPERATION AND EQUIPMENT 

(a) The rules and regulations adopted by the U.S. Department of Transportation relatmg to safety 

of operation and equipment (49 CFR Parts 390-398 and amendments thereto) shall apply to all for-hire 

motor carrier \ehicles, whether common carriers, contract carriers or exempt carriers and all private 

motor carriers, while engaged in interstate commerce over the highway's of the State of North Carolina. 

fb) The rules and regulations adopted by the U.S. Department of Transportation relating to safety 

of operation and equipment (49 CFR Parts 390-398 and amendments thereto) shall apply to all for-hire 

motor carrier vehicles, whether common carriers, contract carriers or exempt carriers and all private 

motor carrier vehicles engaged in intrastate commerce over the liighways of the State of North Carohna 

il such vehicles have a GVAVR of greater than 26,000 pounds; are designed to transport 16 or more 

passengers, including the driver; or transport hazardous materials required to be placarded pursuant to 

49 CFR 170-190. Provided, the following exceptions shall also apply to all intrastate motor carriers: 

(1) An intrastate motor carrier driver may not dnve more than 12 hours following eight consecutive 

hours off duty; or for any period after having been on duty 16 hours following eight consecutive 

hours off duly; or after having been on duty 70 hours in seven consecutive days; or more than 

80 hours in eight consecutive days. An intrastate driver wUl be determined by his previous seven 

days of operation. 



6:16 NORTH CAROLINA REGISTER Novcmbei 15, 1991 1236 



FINAL RULES 



(2) Persons who otherwise qualify medically to operate a commercial motor vehicle within the State 
of North Carolina will be exempt from provisions of Part 391.11(b)(1) and Part 391.41(b)(1) 
through (11) and therefore will be authorized for intrastate operation il" hcensed prior to March 
30, 1992, are approved by an Exemption Review Officer appointed by the Commissioner of 
Motor Vehicles and meet all other requirements of this Section. These drivers shall continue 
to be exempt upon completion of a biennial medical examination indicating the condition has 
not worsened or no new disqualifying conditions have been diagnosed and upon continued ap- 
proval of an Exemption Review Officer. 
(c) The rules and regulations adopted by the U. S. Department of Transportation relating to in- 
spection, repair and maintenance of motor vehicles (49 CER Part 396.17 through 396.23 and including 
Appendix G, and amendments thereto) shall apply to all for-hire motor carrier vehicles, whether com- 
mon carriers, contract carriers or exempt carriers and all private motor carrier vehicles engaged in 
intrastate commerce over the highways of the State of North Carolina if such vehicles have a G\'\VR 
of greater than 10,000 pounds. Provided, any farm vehicle shall be exempt from the requirements of 
this Paragraph if 

(1) It is being operated by a farmer (or a person under the direct control of the farmer) as a private 
motor carrier of property; 

(2) It is being used to transport either; 

(A) agricultural products, or 

(B) farm machinery, farm supplies, or both, to and from a farm; 

(3) It is being operated solely within this State and within 150 air-miles of the farmer's farm; 

(4) It is not being used in the operation of a for-hire motor carrier; and 

(5) It is not carr>'ing hazardous materials of a t>pe or quantity that requires the vehicle to be plac- 
arded in accordance with 49 Cl'R 177.823. 

llistoty Sole: Statuion Authority G.S. 20-3S4; 
Eff. December I, 1983: 

Amended Eff. November J. /99/; October 1. 1991: 
June I. 1991: \ovember I, 1990. 

.0804 PI RCHASE OF FOR HIRE LICENSE TAGS 

(a) A certificate of exemption for the transportation of property issued as provided in Rule .0803 
constitutes approval by the Division of the purchase of for hire tags for vehicles owned by and registered 
in the name of the party to whom such certificate of exemption is issued. The certificate of exemption 
must be presented to the Division of .Motor \'ehicles or its authorized agents when purchasing for hire 
tags. 

(b) A certilicate of exemption for the transportation of passengers issued as pro\ ided in Rule .0803 
does not in itself constitute approval by the Division of the purchase of for hire tags for vehicles owned 
by the person to whom such certificate is issued. For hire tags may only be purchased by holders of 
exemption certificates for the transportation of passengers who are in full compliance with the insurance 
and safet\' rules of the Division. Vehicles of such earners must be registered \\ ith the Di\ ision as re 
quired by Rule .0809 and upon carrier's compliance with said insurance and safety rules and regu 
lations, said vehicles will be approved by the Division of Motor Vehicles so that tags may be purchased, 
but not betbre. 

History .\ote: Filed as a Temporan' Rule Eff. February 11. 1986 for a 
Period of 120 Days to Expire on June 11. 1986: 
Statuton- Aulhoritv G.S. 20-378; 
Eff April 1. 1986: 
Amended Eff November 1 . 1991 . 

.0808 REGILATION CARRIERS: USE OF RENTED OR LEASED \ EHICLES 

(a) No carrier authorized to operate as a common carrier of property or as a contract carrier of 
property by the Utilities Commission shall use any vehicle of which such carrier is not the o\\ ner fo 
the transportation of property for compensation, except under a bona fide written lease from the owner 
subject to the following conditions: 

(I) The lessee shall use such vehicles only for purposes and within the territory' covered by his op 
eratinc authoritv and for the term of the lease. 



12M 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



(2) The property transported shall be transported in the name of and under the responsibility of the 
said lessee, and under the direct supervision and control of the lessee. 

(3) The dri\ers of said leased equipment shall be directly super\ised and controlled by lessee. 

(4) The name, address and certLTicate or permit number assigned to the lessee shall be displayed on 
the leased vehicle as required by the Utihties Commission. 

(5) 1 he vehicle shall be covered by insurance in the name of the lessee as required by the Utilities 
Commission. 

(6) The lease shall sf>ecify a defmite effective period, the amount of consideration to the lessor, and 
shall hst and describe the equipment covered. 

(7) A legible copy of the executed lease shall be carried in the leased \ehicle at all times, unless a 
certificate as provided in Paragraph (a)(8) of this Rule is carried in lieu thereof. 

(8) Unless a copy of the lease is carried on the equipment as provided in Paragraph (a)(7) of this 
Rule, the authorized carrier shall prepare a statement certifying that the equipment is being op- 
erated by it, which shall specify the name of the owner, the date of the lease, the period thereof, 
any restrictions therein relative to the commodities to be transported, and the location of the 
premises where the original of the lease is kept by the authorized carrier, which certificate shall 
be carried with the equipment at all times during the entire period of the lease. 

Exception: The provisions of this Rule shall not apply to the interchange of trailers. 

(b) No common or contract carrier of property shall lease its equipment for pnvate use in the trans- 
portation of commodities which it is authorized to transport by authority of the Utilities Commission, 
and no common or contract carrier of property shall lease equipment with drivers to private carriers 
or shippers under any circumstance. 

(c) The rules and regulations relating to lease and interchange of vehicles, as prescribed in the Code 
of Federal Regulations, Title 49 - Transportation, Chapter X - Interstate Commerce Commission, 
Sub-Chapter A - General Rules and Regulations, Part 1057 - Uease and Interchange of Vehicles, to the 
extent that said regulations are not in conflict with the North Carolina Statutes, shall apply to all motor 
carriers of property authorized by the North Carolina Utihties Commission to operate in North 
Carolina. 

History Note: Filed as a Femporary Ride Fff. February II, I9S6 for a Period of 
120 Days to Expire on June II, 1986; 
Statutory Authority G.S. 20-378; 
Fff April I, 1986; 
Amended Eff November 1 , 1991 . 

.0809 BECrVNING OPER.\TIO\S FOR THE TRANSPORTATION OF PASSENGERS 

(a) An order of the Utilities Commission, approving an application, or the issuance of a certificate 
or a permit, or a certificate of exemption issued by the Di\ision for the transportation of passengers, 
does not within itself authorize the carrier to begin operations. Operations are unlawful until the carrier 
shall have comphed with the law by: 

(1) Registration of its rolling equipment with the Division on Form MC-19. 

(2) Filing insurance with the Di\i5ion covcnng its roUing equipment or by providing other security 
for the protection of the pubhc, as provided by the I tihties Commission. 

(3) In the case of common and contract carriers, filing tarilTs and schedules or rates and charges with 
the Utilities Commission to be made for the transportation scr\ice authorized, as provided by 
the Utilities Commission. 

(b) Unless a common or contract carrier comphes with the foregoing requirements and begins oper- 
ating, as authorized, within a period of 30 days after the commission's order approving the application 
becomes final, and unless the time is extended in writing by the Utihties Commission upon written 
request, the operating rights therein granted wiU cease and determine. 

Hision' Note: Filed as a Femporary Rule Eff. February II, 1986 for a Period of 
120 Days to Expire on June II. 1986; 
Statutory Authority G.S. 20-378; 
Eff April I, 1986; 
Amended Eff November I, 1991. 

.0815 EVIDENCE OF LIABILITY SECURITY 



6:16 NORTH CAROLINA REGISTER November 15, 1991 I23S 



FINAL RULES 



(a) All such interstate motor carriers shall keep in force at all times public liability and property 
damage insurance in amounts not less than the minimum limits prescribed by the U.S. Department of 
Transportation or Interstate Commerce Commission. The policy shall have attached thereto an 
endorsement in the form set forth in Form F and as evidence of such insurance, there shall be filed 
with the Division a certificate in the form set forth in Form F of these Rules. 

(b) Notice of cancellation of insurance shaU be given to the Division by the insurer in the form of 
notice set forth in Form K. 

(c) Such motor carriers who have been permitted to post bond in lieu of insurance or who have 
qualified as self-insurers, under the rules and regulations of the Interstate Commerce Commission, shall 
not engage in interstate commerce within the borders of this state unless and until such carriers have 
filed surety bonds which have been accepted by the Division in the form set forth in Form (} or a true 
and legible copy of the currently etfective ICC order authorizing such motor carrier to self-insure under 
the provisions of the Interstate Commerce Act. Notice of cancellation of surety bonds shall be given 
to the Division in the form of notice set forth in Form L. 

(d) No such policy or bond shall be acceptable unless issued by an admitted company or a surplus 
lines company as permitted in G.S. 5S-420 et. seq. Pro\ided, if the motor carrier is not registered in 
this state and the insurance company or surety company is a non-admitted company, the company shall 
execute a power of attorney authorizing the commissioner to accept service on its behalf of notice or 
process in any action upon the policy or bond arising out of an accident involving the motor carrier in 
this state. Further, the company must be quaHfied in the state where the motor carrier is registered. 

Hlston- Sole: Filed as a Temporary Rule Eff. February II, 1986 for a Period of 
120 Days to Expire on June II. I9S6; 
Statutory Authority G.S. 20-378; 
Eff. April I, 1986; 
Amended Eff. November 1 . 1991 . 

OS 1 7 DESIGN.ATION OF PROCESS AGENT 

No such carrier shall engage in interstate commerce within the borders of the State of North Carolina 
unless and until there shall have been fded with and accepted by the Division a currently effective des- 
ignation of a local agent for sen."ice of process. Such earner shall tile such designation by showing the 
name and address of such agent on the uniform application for registration of interstate operating au- 
thority as set forth in Form A a\ailablc from the Motor Carrier Regulatorv' Umt or by furnishing the 
Division with a true copy of the designation of such agent fdcd with the Interstate Commerce Com- 
mission. 

History \ote: Filed as a Temporary Rule Eff. February II, 1986 for a Period of 
120 Days to Expire on June II, 1986; 
Statutory Authority G.S. 20-378; 
Eff .April I. 1986; 
Amended Eff. November I, 1991. 

.0823 \ EHICLE REGISTRATION AND IDENTIFICATION REQUIRED 

(a) A motor carrier shall not operate a vehicle or engage in drivcaway operations within the borders 
of the state unless and until the vehicle or driveaway operation shall have been registered and identified 
with the Division in accordance with these Paragraphs and there shall have been a compliance with all 
other requirements of these Rules. 

(b) On or before the thirty-first of Januaiy of each calendar year, but not earlier than the preceding 
first day of October, such motor carrier shall apply to the Division for the issuance of an identification 
stamp or stamps, for the registration and identification of the vehicle or vehicles which it intends to 
operate, or driveaway operations which it intends to conduct, within the borders of this state during the 
ensuing year. The motor carrier may apply for such number of stamps as is sufficient to cover its ve 
hides or driveaway operations which it anticipates will be placed in operation or conducted during the 
period for which the stamps are effective. The motor carrier may thereafter fde one or more supple- 
mental apphcations for additional stamps if the need therefore arises or is anticipated. 

(c) If the Division determines that the motor carrier has complied with all apphcable provisions ol 
these Rules, the Division shall issue to the motor carrier the number of identification stamps requested 

(d) An identification stamp issued or assigned under the provisions of this Section shall be used fo: 
the purpose of registering and identifying a vehicle or dnveaway operations as being operated or con 



12 i9 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



ducted by a motor carrier, and shall not be used for the purpose of distinguishing between the vehicles 
operated by the same motor carrier. A motor carrier receiving an identification stamp under the pro- 
visions of this Section shall not knowingly permit the use of same by any other person or organization. 

(e) On or before the thirty-first day of January of each calendar year, but not earlier than the pre- 
ceding first day of October, such motor carrier shall apply to the National Association of Regulatory 
L'tiUty Commissioners for the issuance of a sufficient supply of uniform identification cab cards for use 
in connection with the registration and identification of the vehicle or \ehicles which it intends to op- 
erate, or driveaway operations which it intends to conduct, within the borders of the state during the 
ensuing year. 

(f) The NARL'C shall issue to the motor carrier the number of cab cards requested. A motor carrier 
receiving a cab card under the provisions of this Section shall not knowingly permit the use of same 
by any other person or organization. Prior to operating a vehicle, or conducting a driveaway operation, 
within the borders of the state during the ensuing year, the motor carrier shall place one of such iden- 
tification stamps on the back of a cab card in the square bearmg the name of the state in such a manner 
that the same cannot be removed without defacing it. The motor carrier shall thereupon duly complete 
and execute the fonn of certificate printed on the front of the cab card so as to identify itself and such 
vehicle or driveaway operation and, in the case of a vehicle leased by the motor carrier, such expiration 
date shall not exceed the expiration date of the lease. The appropriate expiration date shall be entered 
in the space provided below the certificate. Such expiration date shall be within a period of 15 months 
from the date the cab card is executed and shall not be later in time than the expiration date of any 
identification stamp or number placed on the back thereof 

(g) The registration and identification of a vehicle or dri\eaway operations under the provisions of 
this Section and the identification stamp evidencing the same and the cab card prepared therefore shall 
become void on the first day of Februar>' in the succeeding calendar year, unless such registration is 
terminated prior thereto. 

(h) The application for the issuance of such identification stamps shall be in the form set forth in 
Form B-l which is available from the Motor Carrier Regulator)' Unit. The application shall be printed 
on a rectangular card or sheet of paper 1 1 inches in height and 8 and 1,2 inches in width. The appli- 
cation shall be duly completed and executed by an official of the motor carrier, and shall be accompa- 
nied by a filing fee in the amount of one doUar ($1.00) for each identification stamp apphed for. 
Applications for annual reregistration of such motor vehicles shall be accompanied by a filing fee in the 
amount of one dollar ($1.00) for each identification stamp applied for. Provided, that vehicles of such 
carriers domiciled in another jurisdiction which extends reciprocity to \ehicles of earners domiciled in 
North Carolina, pursuant to the general reciprocal agreements heretofore or hereafter entered into with 
the North Carolina Commissioner of Motor Vehicles under Article I A of Chapter 20 of the General 
Statutes, shall be exempt from the payment of registration fees required in this Paragraph to the same 
extent as such jurisdiction exempts \ehicles of carriers domiciled in North Carolina from annual inter- 
state public utilities vehicle registration fees similar to the fee required in this Paragraph. 

(i) The apphcation for the issuance of such cab cards shall be duly executed by an official of the motor 
carrier. 

(j) The identification stamp issued under the provisions of this Section by the Division shall bear its 
name or symbol and such other distinctive markings or information, if any, as the Di\ision deems ap- 
propriate. In addition, such stamp shall bear an expiration date of the first day of February- in the 
succeeding calendar year. The stamp shall be in the shape of a square and shall not exceed one inch 
m diameter. 

(k) The cab card referred to in Paragraphs (a) through (j) of this Rule shall be in the form set forth 
in Form D-l which is available from N.ARUC, and shall bear the seal of the NARUC. The cab card 
shall be printed on a rectangular card 1 1 inches in height and 8 and 1/2 inches in width. 

(I) In the case of a vehicle not used in a driveaway operation, the cab card shall be maintained in the 
cab of such vehicle for which prepared whenever the vehicle is operated by the carrier identified in the 
cab card. Such cab card shall not be used for any vehicle except the velucle for which it was originally 
prepared. A motor carrier shall not prepare two or more cab cards which are effective for the same 
vehicle at the same time. 

m) In the case of a dnveaway operation, the cab card shall be maintained in the cab of the vehicle 
furnishing the motor power for the driveaway operation whenever such an operation is conducted by 
the carrier identified in the cab card. 

(n) A cab card shall, upon demand, be presented by the driver to any authorized agent or represen- 
ative of the North Carolina Division of \Iotor Vehicles. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1240 



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(1) Each motor carrier shall destroy a cab card immediately upon its expiration, except as otherwise 
pro\ided in the proviso to Subparagraph (2) of this Paragraph. 

(2j A motor carrier permanently discontinuing the use of a vehicle, for which a cab card has been 
prepared, shall nullify the cab card at the time of such discontinuance; Provided, however, that 
if such discontinuance results from destruction, loss or transfer of ownership of a vehicle owned 
by such carrier, or results from destruction or loss of a vehicle operated by such carrier under 
lease of 3(.) consecutive days' duration or more, and such carrier provides a newly acquired ve- 
hicle Ln substitution therefore within 30 days of the date of such discontinuance, each identifi- 
cation stamp and number placed on the cab card prepared for such discontinued vehicle, if such 
card is stLU in the possession of the carrier, may be transferred to the substitute vehicle by com- 
pliance with the following procedure; 
(.A) Such motor carrier shall duly complete and execute the form of certificate printed on the front 
of a new cab card, so as to identity itself and the substitute vehicle and shall enter the appropriate 
expiration date in the space provided below such certificate; 

(B) Such motor carrier shall indicate the date it terminated use of the discontinued vehicle by 
entering same Ln the space provided for an early expiration date which appears below the cer- 
tificate of the cab card prepared for such vehicles; and 

(C) Such motor carrier shall affix the cab card prepared for the substitute \ehicle to the front of 
the cab card prepared for the discontinued vehicle, by permanently attaching the upper left-hand 
comers of both cards together in such a manner as to permit inspection of the contents of both 
cards and. thereupon, each identification stamp or number appearing on the back of the card 
prepared for the discontinued vehicle shall be deemed to apply to the operation of the substitute 
\ehicle. 

(3) An\ erasure, improper alteration, or unauthorized use of a cab card shall render it \oid. 

(4) If a cab card is lost, destroyed, mutilated, or becomes illegible, a new cab card may be prepared 
and new identification stamps may be issued therefore upon application by the motor carrier and 
upon payment of the fee prescribed. See G.S. 20-385. 

History Xote: Filed as a Femporary Rule Fff. Febntary IF 1986 for a Period of 
120 Days to Expire on June //, I9S6; 
Statutory' Authoritv G.S. 20-3~S; 
Fff. April I, 1986: 
.Amended Fff. .\ovember /, 1991. 

.0824 EMDENCE OF LIABILII V SECL RH V 

(a) .AJl such interstate exempt motor carriers shall keep in force at all times public hability and 
property damage insurance in amounts not less than the minimum Hmits prescribed by the United 
States Department of Transportation or the Interstate Commerce Commission. The policy shall have 
attached thereto an endorsement m the form set forth in Form F and as e\idencc of such insurance, 
there shaU be fded with the Division a certificate in the form set forth in Form E. 

(b) Notice of cancellation of msurance shall be given to the Division by the insurer in the form of 
notice set forth in Form K. 

(c) Such motor carriers who elect to post bond m Ueu of insurance must do so in the fonn set forth 
in Form G. Notice of cancellation of surety bond shall be given to the Division in the form of notice 
set forth in Form L. 

(d) No such policy or bond shall be acceptable unless issued by an admitted company or a surplus 
lines company as permitted m G.S. 58-420 et. seq. Provided, if the motor carrier is not registered in 
this state and the insurance company or surety company is a non-admitted company, the company shall 
execute a power of attorney authorizing the commissioner to accept service on its behalf of notice or 
process in any action upon the polic\ or bond arising out of an accident involving the motor carrier in 
this state. Further, the company must he qualified in the state where the motor carrier is registered 

History Sote: Filed as a Femporary Rule Fff. February: 1 1 ^ 1986 for a Period of 
120 Days to Fxpire on June II, 1986; 
Statutor\' Authoritv G.S. 20-3'^8; 
Fff. April I, 1986: 
Amended Fff. \ or ember F 1991 . 

.0827 rSA ESTIGATION OF MOTOR CARRIER ACCIDENTS 



1241 6:16 SORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



History Note: Filed as a Temporary Rule Fff. February II, 1986 for a 
Period of 120 Days to Expire on June II, 1986; 
Statutory Authority G.S. 20-378; 
Eff April I, 1986; 
Repealed Eff. November I, 1991. 

SUBCHAPTER 3E INTERNATIONAL REGISTRATION PLAN (IRP) SECTION 

SECTION .0300 - REGLSTRA TION OF RENTAL VEHICLES BY NONRESIDENTS 

.0302 ONE-WAY TRl CK REGISTRATION 

(a) In addition to the General Statutes concerning truck registration, ever)' applicant shall assign a 
unit number to each motor vehicle owned or operated. 

(b) The minimum number of vehicles to be licensed in North Carolina shall be determined as foOows: 

(1) Divide the North Carolina miles by the total miles traveled (all jurisdictions) by each class of 
motor vehicles during the preceding year. The preceding year means the period of 12 consec- 
utive months immediately prior to July 1st of each year immediately preceding the commence- 
ment of the registration or license year for which the application is being tiled. 

(2) Multiply the North Carolina percent times the total number of vehicles owned or operated 
January 1st in the particular class. 

(3) When equipment is added to a particular class after January 1st of any licensing year, the same 
percent used at the beginning of that licensing year (January 1st) shall be used to determine the 
portion of the new vehicles to be registered in North Carolina. 

(4) A record of unit number, identification, declared gross weight, miles traveled, monthly inventory 
(motor vehicle) records, North Carolina hcense number and date license purchased shall be re- 
tained for three years. 

(c) The appropriate forms for this Section are on tile for review or may be obtained from the Inter- 
national Registration Plan (IRP) Section of the Division of Motor Vehicles, Raleigh, North Carolina. 

History Note: Statutory Authority G.S. 20-1; 20-84.2; 
Eff July I, 1978; 
Amended Eff November I, 1991; July I, 1983; February I, 1982. 

.0303 UTILITY IRAILER REGISTRATION 

(a) The nainimum number of utility trailers to be licensed in North Carolina shall be determined as 
follows: 

(1) Divide each month, January thru December, for 5-year license plate renewal or each month of 
12 consecuti\c months determined in accordance with North Carolina's staggered registration 
program for annual license plate renewal the number of trailers in North Carolina, which are 
not on one-way rentals, by the total number of trailers in all jurisdictions, which are not on 
one-way rental. 

(2) Multiply monthly, January thru December, or the 12-month designated period, the North 
Carolina percent times the total number of trailers owned (entire fleet) whether rented or not 
rented. 

(3) Add the twelve resulting monthly figures and divide the total by 12. 

(4) Register in North Carolina no less than the number of trailers equal to the average number of 
utihty trailers rented and available for rent in North Carolina during the preceding registration 
or license year. The monthly inventory records, number of licenses purchased in North Carolina 
each year and records of payments shall be retained for three years. 

(b) The appropriate forms for this Section are on file for review or may be obtained from the Inter- 
national Registration Plan (IRP) Section of the Division of Motor Vehicles, Raleigh, North Carolma. 

History Note: Statutory Authority G.S. 20-1; 20-66; 20-86.1; 
EffJulvl, 1978; 

Amended Eff November I, 1991; Julv I. 1983; 
February I. 1982. 

.0304 I -DRrV E-IT CAR REGISTRATION 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1242 



FINAL RULES 



(a) The minimum number of vehicles to be licensed in North Carolina at the beginrung of each reg- 
istration year (determined by staggered registration) shall be determined as follows: 

( 1 j Divide gross revenue earned in North Carolina by gross revenue earned in all jurisdictions during 
the preceding accounting year. The preceding accounting year means the 12 consecutive months 
January 1 thru December 31 (or as otherwise approved by the Commissioner), immediately 
preceding the registration year for which the application is filed. 

(2) Multiply the North Carolina percent times the total number of passenger cars (u-drive-it) owned 
or operated as of the first day of the month of the registration year (determined by the staggered 
registration system). 

(3) When equipment is added to the fleet after the original application is filed for any registration 
year, the same percent used at the beginning of that registration year shall be used to determine 
the number of passenger cars (u-drive-it) subject to registration in North Carolina during that 
particular month and each month thereafter through that registration >ear. 

(4) A record of gross revenue earned in each jurisdiction, a record of Licenses purchased and dates 
(day, month and year) shall be maintained for three years. 

(b) The appropriate forms for this Section are on fde for review or may be obtained from the Inter- 
national Registration Plan (IRP) Section of the Division of .Motor Vehicles, Raleigh, North Carolina. 

History Sole: Statutory Authority G.S. 20-1; 20-66; 20-86.1; 
Eff. July I. 1978; 

Amended Eff. November I, 1991; July I, 19S3; 
February I, 1982. 

SECTION .0400 - INTERNATIONAL REGISTRATION PLAN 

.0401 (GENERAL ESEORMATION 

(a) Vehicles used or intended for use in two or more jurisdictions that allocate or proportionally 
register \ehicles for the transportation of persons or property, unless excepted by this Section, are re- 
quired to be registered in accordance with the pro\isions of the International Registration Plan. 
''Apportionable vehicle" as used in this Section means any \ehicles. except recreational \ehicles, vehi- 
cles displacing restricted plates, city pick up and delivery \ehicles, buses used in transportation of 
chartered parties, and govemment-owned vehicles, used, or intended for use, in two or more jurisdic- 
tions that allocate or proportionally register vehicles and is used for the transportation of persons for 
hire or designed, used or maintained primarily for the transportation of property and: 

(1) is a power unit having two axles and a gross vehicle weight or registered gross vehicle weight in 
excess of 26,000 pounds; or 

(2) is a power unit ha\ing three or more axles regardless of weight; or 

(3) is used m combination when the weight of such combination exceeds 26.000 pounds gross ve 
hide weight. 

(b) Vehicles, or combinations thereof, having a gross vehicles weight of 26,000 pounds or less and 
tuo-axle vehicles and buses used in transportation of chartered parties may be proportionally registered 
at the option of the registrant. 

(c) The R;deigh and Charlotte OtTices of the North Carolina Division of Motor Vehicles are re- 
sponsible for registering vehicles under the International Registration Plan. Registrants or other inter- 
ested persons may obtain the International Registration Plan manual and the application schedule 
forms from: 

(1) North Carolina Division of .Motor Vehicles 
l.R.P. Section 

1 1 00 New Bern Avenue 

Raleigh, North Carolina 27697; or 

(2) North Carolina Division of Motor Vehicles 
l.R.P. Unit 

6016 Brookshire Blvd. 
Charlotte, North Carolina 28216. 

(d) The principles for implementation of this registration reciprocity agreement among states of th 
L'nited States and provinces of Canada are found in the most recent publication of the Internationa 
Registration Plan Policies and Procedures Manual, the Uniform Operation .\udit Procedures Guide 
hnes and the North Carolina Department of Transportation, Division of .Motor Vehicles Intemationa 
Resistration Plan Manual. 



U4i 6:16 NORTH CAROLINA REGISTER November 15, 1 99 1 



FINAL RULES 



Hhtor}' Note: Statutory Authoritv G.S. 20-86.1; 20-91; 
Eff. July I. I9S3: ' 
Amended Eff. Xovember I , I99L 

.0402 REGISTRATION LADER THE FSTERNATIONAL REGISTRATION PLAN 

History Note: Statutory' .Authoritv G.S. 20-86.1; 
EffJulvl. 1983: ' 
Repealed Eff November 1, 1991. 

.0403 LICENSE PERIOD EOR IRAILER PLATE 

(a) G.S. 20-666 established the expiration date for both annual and staggered registration plates. 
Under an agreement with the Di\ision, trailer plates may be issued for a period of up to five \ears with 
the following conditions: 

(1) Payment is made for the first years's fees; 

(2) A certificate of deposit. appro\ed by the Commissioner, in an amount equal to the fees for the 
remainder of the issuance period, shall be tiled with the Division; 

(3) Payment for each additional year is made during the normal renewal period. The certificate of 
deposit may be reissued each year in an amount equal to the fees for the >ears remaining on the 
agreement. 

(b) Copies of the trailer registration plate agreement are awailable from the International Registration 
Plan Section, Division of Motor Vehicles, 1100 New Bern Avenue, Raleigh, North Carolma 27697. 

Histmy Note: Statutor\- Authoritv G.S. 20-39; 20-63: 20-8^(9); 20-88; 
Eff .Xovember 1, 1991. 

SUBCHAPTER 3E - COLLISION REPORTS/GENERAL SERVICES SECTION 

SECTION .0100 - GENERAL INEOR.MATION 

.0101 PURPOSE 

I'his Subchapter explains the accident reporting process and establishes rules for the publication of 
statistics de\eloped from accident reports. 

Histotr Note: Statutoiy Authoritv G.S. 20-1: 20-3: 20-166.1; 20-279.1 through 20-279.39; 
Eff Julv 1. 1978; ' 
Amended Eff November 1. 1991: Eebniary 1. 1982. 

.0102 FORMS 

Histoiy Note: Statutory Authoritv G.S. 20-1 : 20-3; 
Eff July 1, 1978; ' 
Amended Eff Eebniary 1 . 1982: 
Repealed Eff. November 1. 1991. 

SEC HON .0200 - STATISTICAL D VI A ASSEMBLED AND PUBLISHED 

.0201 TRAFFIC ACCIDENT SUMMARY 

(a) The Collision Reports General Ser\'ices Section publishes a summary of motor \ehicle traffic 
accidents monthly and annually. This publication contains information on all types of motor vehicles, 
pedestrian and bicNcle accidents. The accidents are categorized by; 

(1) county, 

(2j rural or urban, 

(3) time of day, 

(4) day of week, 

(5) dn\'crs by age and sex, 

(b) The summar.' is provided to federal and state agencies, ofticers of the court, the Division of 
Highways, reseairh institutes and libraries. It is also a\ailable to the general public upon request. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1244 



FINAL RULES 



lliston- Sote: Siatuton' Auihorkv G.S. 20-1: 20-166.1: 20-3; 
Eff.Juh I. /9ZS: ' 
Amended Bff. Sovember I, 1991; February 1, I9S2. 

(1202 I AIM. ACCIDINT RKl'OR IS 

The Collision Reports General Services Section publishes monthly a report on the number of fatal 
accidents and the number of persons killed in these accidents. Comparisons arc made with information 
from the prior year. This report is furnished to ofticers of the court, the lligliway Patrol and the news 
media. 

Ifision- \ole: Statutory Authority G.S. 20-1; 20-166.1: 20-3; 
Eff. Julv 1. 197S; 
Amended Eff. .Xovember 1. 1991: Febniary I. 19S2. 

.02(M SFKCIAL HOLIDAY RIPORI 

Special holiday reports gi\ing infonnation on prior year fatalities, injuries, accidents and dri\er \'io- 
lations arc published by the (.'ollision Reports Cjcneral SerMces Section. These reports are pro\idcd 
to the National Safety Council and the lligli\\a\ Patrol and are used b_\ the news media to project ac- 
cidents o\'er a holiday penod. 

lliston- \ote: Statutor\- Authority G.S. 20-1; 20-166.1; 20-3: 
Eff.luh'l. 1978: 
Amended Eff Sovember 1. 1991: Febnuvy 1. 1982. 

SIXIION .03(M» ADMIMSTRATH E SIPPOR I OF IllC.im AY PATROL 

.0301 HK.IIWAY PAl ROL ACLI\ IIY REPORTS 

lliston- Sote: Statutoiy .-iuthoritv G.S. 20-/: 20-3: 
Eff. July 1. 19ZS: ' 
Amended Eff Febman I. 1982; 
Repealed Eff Sovember 1. 1991. 

SECTION .0600 SALE I Y AND FINANCIAL RESPONSIBILI lY 

.0601 PROOF OF FINANCIAL RESPONSIBILITY 

(a) The Di\ision of Motor N'ehicles u ill furnish to \ chicle owners and or operators appropriate forms 
to facilitate compliance with Article '■^.A. Chapter 20 of the .Motor \'ehicle Safet\^ and rinanciaJ Re- 
sponsibility .Act of N53. 

(b) Vehicle owners and or operators of automobiles iiivohed in an accident may funiish required 
proof of financial responsibilit>" on documents prescribed by the Di\ision. 

lliston- Sote: Statutoiy .-Iuthoritv G.S. 20-2^9.1 throii:;h 20-279.39; 
Eff. Sovember 1. 1991. 

.0602 ADMINISTRATE E FLSANCIAL RESPONSIBILITY HEARINGS 

(a) Any person who has recencd notice of a dn\er s license suspension due to an automobile accident 
for failure to file proof of financial rcsponsibiht\' may request a hearing. 

(b) Recjuest for a hearing must be made in writing to the Division within 15 days from the date shown 
on the proposed suspension order. 

(c) The receipt of such request will stay the effectis'c date of the suspension order for 30 days or until 
the hearing is held. 

(d) The petitioner must furnish the Division with a brief statement of the circumstances of the acci- 
dent in which he or his \ehiclc was inNoh'ed. grounds relied u]>on to exonerate him from suspension, 
and a certified copy of any traffic court judgment related to the accident. This iiitbnnation must be 
recei\'ed at the Division at least tne days prior to the date fixed for hearing. 

(e) Due process will be satisfied by an inquin." limited to the detennination of whether there is a 
reasonable possibility of a judgment being rendered against the petitioner should he be sued in a civil 



1245 6:16 SORTH CAROLLSA REGLSTER Sovember 15, 1991 



FINAL RULES 



action and lose his case. The burden of proof is on the petitioner to demonstrate to the hearings officer 
that there is no reasonable possibility that a judgment would be rendered against him in a court of law, 
(f) If the hearings officer establishes that liability insurance was in effect on the date of the accident, 
or that the petitioner has assumed fmanciaJ responsibility for the damages in the accident, the officer 
wlU rescind the Division's prior notice of revocation. 



Histoiy Sole: Statuton Authoritv GS. 20-279.2; 20-279.4: 20-279.5; 
Eff. November I, 1991. 

SLBCH.APTLR 3(. SCHOOL Bl S AND TRAIFIC SAIKTV SK( 1 ION 

SECTION .((100 - GKNKRAL INFORM ATION 

.0101 PI R POSE 

This Section deals with various driver education programs designed to improve driving skills and 
promote traffic safety. Rules for commercial dnver training schools and school bus driver certification 
are also established. The follow ing publications are available from the School Bus and Traffic Safety 
Section of the Division of Motor Vcliicles, 1100 New Bern A\cnuc, Raleigh, N. C. 27697: 

(1) Rules and Regulations Go\cming the Licensing of Commercial Dri\cr Training Schools; 

(2) Rules and 1-legulations (jo\eniing the Issuance and Cancellation of School Bus Driver Certif- 
icates; 

(3) Schedule of Dri\er Improvement Clinics. 

Hisloty .\ute: StaluiofT Authoritv G.S. 20-1; 20-3; 20-^(1-/ ) and im); 
20-l6(cj: 20-SS.l: 20-218: 20-320 throwih 20-328; 
Eff. Julv I, 19'8; 
Amended Eff. Sovember I. 1991: Febniary I. 1982. 

SECTION .0300 - RESTRICTED ESSTRL C LION PERMIT 

.0301 DRI\ ER EOLCAIION PERMIT 

(a) North Carolina (j.S. 20-''(l-l) and (m) pro\ide for issuance of a restricted instniction permit to 
persons enrolled in high school dri\'er education courses, commercial dri\"er training schools, and 
community colleges and technical institutes. .-VU of these schools must be approved by the State Su- 
perintendent of Public Instruction. 

(b) The student's vision and physical condition are checked and recorded on the permit. ^A driver 
education specialist issues this pcmiit to qualified students, when reciuested to do so by the school. 

Histon Sotc: Statuton Authority G.S. 20-1; 20-7(1-1 1 and imj; 20-88. 1; 
Eff. July I. 1973; 
Amended Eff Xovembcr I, 1991: February I. 1982. 



SECTION .0400 - DRI\ ER IMPRON EMENT CLINICS 

.0401 CLINICS 

(a) 1 he School Bus and Traftic Safety Section operates dri\'er impro\ement climes in \anous lo- 
cations across the state to provide assistance to drivers who ha\e had difficulties concerning their dri\- 
er's license. The most frequent ditTiculties are the accumulation of points against their driving records 
or having had their hcense suspended for tralTic \iolations. While the hearing officers of the Dri\er 
License Section and traftic courts are the primary source of pro\ idmg enroUees to the clinic, the clinics 
are open to \olunteer drixers for self-improvement purposes. 

(b) Rules of the road, driver license laws, and safe dri\ing practices are taught by lectures and dis- 
cussions. F.\tensi\e use is made of selected films, \isual aids, and a student workbook. 

(c) Successful completion is detennined by the mstructor upon the basis of the enrollecs cooperation 
in completing all assigned work and classroom behavior. After completion, notification is made to the 
assigning agency so proper credit may be given to the applicant. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1246 



FINAL RULES 



(d) Dri\ers accumulatmg se\en or more points or four points in a three-year period following rein- 
statement of their licenses may be given the opportunity to attend a conference concerning their driving 
record. Drivers must be advised of the driver improvement clinic and the fee for participation. 

(e) Information regarding the fee for the driver improvement clinic is located in 19A NCAC 3B .01 19. 

llhtorv Xote: Station Authority G.S. 20-1 ; 20-l6(c): 20-/6fej; 
Eff.Julv I. 1978; ' 
Amended Eff. Xovember I. 1991; October I. 1932. 

.0402 INFORMATION 

Dates, locations, and places of clinics are a\ai]ablc through the School Bus and Traffic Safety Section 
and are on fdc in the Commissioner of Motor Vehicles' Office for mspection and re\ic\v during normal 
office hours. 

HislotT Xotc; Statutory' Authority G.S. 20-1 ; 20-l6(cj; 
Eff. July I, 1978; 
Amended Eff. .Xovember I. 1991. 

SECTION .0600 - DRFV ER EDLCAI ION FROC.RAM 

.0601 DRI\ ER EDI CATION AND SAFETY PROGRAM INFORMATION 

(a) The School Bus and Traffic Safety Section provides a number of dnver education programs, safety 
programs, work books and course materials, safety literature and safety films to interested groups. 
These materials are available on loan to groups that present the programs on their own or. upon re- 
quest, a driver education specialist will present the program. 

(b) Some of the courses offered are: 

( 1 ) defensi\e dri\'ing course (National Safety Council): 

(2) presentations on general traffic safety subjects; 

(3) school bus passenger safety; 

(4| bicycle, mini-bike and pedestrian training: 
(5| basic driver education program. 

(c) Intormation concerning course content, scheduhng and an index of safety films (approximately 
250 titles) is available from: 

School Bus and Traffic Safety Section 
Division of Motor \'ehicles 
1100 New Bern .Avenue 
Raleigh. North Carolina 27697. 

Histon .\ote; Statutory: .-hithoritv G.S. 20-1; 20-3; 
Eff Juh' I, 19^8: ' 
Amended Eff Xovember 1. 1991: Eebniaiy /. 1982. 

SL BCIIAPTER 3H - GOVERNOR'S HIGHWAY SAFETY PROGRAM 

SECTION mm - PL RPOSE OF THE OFFICE 

.0101 FEDERAL HIGHWAY SAFETY ACT 

The Federal Highway Safety .Act directs each state to ha\'e a highway safety program approved by the 
L. S. Secretan.' of Transportation and designed to reduce tralTic crashes, deaths, injuries, and property 
damage. The program shall be in accordance with highway safety standards promulgated by the U.S. 
Secretan,' of Transportation. The go\'emor of each state shall be responsible for the administration of 
the program through a state agency which shall ha\e adequate powers, and be suitably equipped and 
organized to carr)' out the program to the satisfaction of the U. S. Sccretar\" of Transportation. 

m.stoiy Xote: Statutory Authority /43B-360; 23 L'.S.C. 402: 
Eff July I, 1978; ' 
Amended Eff Xovember I. 1991. 

.0102 HIGirW'AY SAFETY STANDARDS 



I24~ 6:16 XORTH CAROLLXA REGISTER Xovember 15, 1991 



FINAL RULES 



The Federal Highway Safety Act directs the U.S. Secretary of Transportation to promulgate highway 
safety stand.'irds designed to improve driver and pedestrian performance, provide for an effective traffic 
records system, a method of crash investigation, vehicle registration, vehicle inspection, highway design 
and maintenance, traffic control, vehicle codes and laws, and emergency services. In compliance with 
this Act, the U.S. Department of Transportation has issued eighteen Federal Highway Safety Standards 
to ensure that states direct their highway safety efforts toward comprehensive goals and objectives. 

History Note: Statutory Authority 1 43 B- 360; 23 U.S.C. 402; 
Eff. Julv I, 1 978; 
Amended Eff. Xovember I, 1991. 

SECTION .0200 - PROGRAM DKVELOF.MENT 

.0201 APPLICATION FOR HIGHWAY SAFKIV PRO.JECT CONTRACT 

(a) State agencies and local governments desiring funding for a highway safety project, shall submit 
the required form. 

(b) The Governor's High\va\ Safety Program will re\iew the application for funding and detemiine 
if the proposed project w^ill be funded through the Go\emor's Highway Safety Program. The following 
is the funding criteria: 

(1) eligibility of the project as determined by the Federal Highway Safety Standards; 

(2) project priority based upon the higlnvay safety needs of North Carolina and the monies a\ailable 
for project funding; 

(3) the projected highway safety benefits to be realized from the project; and 

(4) the estimated project cost in relation to the proposed work to be accompUshed, equipment 
purchased, and other costs. 

(c) Following the Governor's Highway Safety Program review of the application, applicants will be 
notified of the results by a Governor's I lighway Safety Program staff member. 

Uistoty iXote: Statutor\- Authority G.S. I43B-360; 
Eff Julv I, /97S; 
Amended Eff. Xovember I. 1991; Eebruaiy I. I9S2. 

.0202 FOCAL GOVFRNMLNT APPFICATION FOR SPEED MEASFRFNG DENICE 
.0203 APPLICAIION FOR ALCOHOL BREAIH I E.SIING DEMCE 

Histon Xote: Statutorv Authority G.S. I43B-3S7; I43B-360; 
Eff July I. 1978; ' 
Amended Eff. February 1 , 1982; 
Repealed Eff Xovember I, 1991. 

.0205 QLARTFRFV PROGRESS REPORl S 

Project contractors, at the discretion of the Go\emor's Highway Safety Program, must submit 
progress reports at 90-day intervals. Projects not submitting progress reports within 15 days following 
the end of a quarter are subject to having reimbursements withheld until compliance is satisfactorily 
achieved. 

History Note: Statutory' Authority G.S. I43B-360; 
Eff Julv I. 1978; ' 
Amended Eff Xovember I. 1991; Febmaty I, 1982. 

.0206 TRAFFIC ENFORCEMENT ACTI\ ITV REPORT 

History Xotc: Statutory Authority G.S. J43B-360; 
Eff July f 1978; ' 
Repealed Eff Xovember I. 1991. 

.0207 ON SITE PRO.JECT REPORT 

The Governor's Highway Safety Program, at its discretion, may perfomi quarter!)' on-site monitoring 
using the appropriate fonn. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1248 



FINAL RULES 



llistorv Sole: Statutory Authority G.S. I43B-360; 
Eff. Julv I, 1978; ' 
Amended Eff. November /, 1991: February I, 1982. 

.0208 FINAL ACCOMPLISHMENT REPORT 

Project contractors must submit a finaJ accomplishment report on the appropriate form within 30 days 
of the termination of the contract unless otherwise directed. Failure to comply jeopardizes future 
funding and can result in withholding of reimbursement claims. 

Uistor\! Sote: Statutory Authority G.S. 1438-360; 
Eff Julv I, 1978; 
Amended Eff November I, 1991; February I. 1982. 

.0209 APPLICAl ION FOR FEDERAL GRANT FOR AMBULANCE VEHICLE 
.0210 APPLICAIION FOR FEDERAL GRANT FOR POLICE VEHICLE 

Hislor\' Sote: Statuton' Authority G.S. I43B-360; 
Eff Julv I. 1978; 
Amended Eff February /, 1982; 
Repealed Eff Xovember /, 199/ . 

.021 1 A\ AILABILITV OF GO\ ERNOR'S HIGHWAY SAFETY PROGRAM FORMS 

/Ml of the Governor's I lighway Salety Program forms cited under the rules in this Section are ob- 
tainable from the Office of Highway Safety Program at: 

Motor Vehicles Building 
1 100 New Bern Avenue 
Raleigh, N. C. 27697 

Handy House 

215 H. Lane Street 

Raleigh, N.C. 27601 

flistor\' .\'ote: Statutory Authority G.S. I43B-360: 
Eff July /, 1978; ' 
Amended Eff Sovember I, 1991: February I. 1982. 

SECTION .0300 - REIMBLRSEMENT CLAIM PROCEDURES 

.0301 CLAIM FOR REIMBl RSEMENT 

(a) Project contractors' claims for reimbursement for a state government project or a local govern- 
ment project wiU be initiated by filing the appropriate Cost Summary Statement form. 

(b) Reimbursement of costs incurred by state or local personnel while attending schools or trainina 
courses directly contracted by the Governor's Highway Safety Program can be initiated by filing th' 
appropriate summary statement form. 

History Note: Statuton' Authority G.S. 143B-360; 
EJfJulvl, 1978; ' 
Amended Eff .Xovember 1. 1991; February I. 1982. 

.0302 SUPPORI I\ F CLAIM 

.AH project contractors submitting claims for reimbursement must also furnish other supporting in 
formation as deemed necessary b\ the Go\emor's Highway Safety Program. 

History Sote: Statutory Authority G.S. 143-129; I43B-360: 
Eff Julv 1. 1978; ' 
Amended Eff November 1. 1991; Februaiy I. 1982. 

.0303 RFQl EST FOR REIMBURSEMENT AUDIT 



1249 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



Project contractors submitting requests for reimbursement will be audited by a Department of 
Transportation Auditor before the Governor's Highway Safety Program reimburses the applicant 
agency. 

Hhtory Sole: Statutory Authority G.S. I43B-360: 
Eff. July I, 1978; 
Amended Eff. November I, 1991; February I, 1982. 

SECTION .0400 - NONEXPENDABLE EQUIPMENT 

.0401 \ ERIFIC.ATION OF ADHERENCE TO PURCHASING PROCEDURES 

Before obligating project funds to the purchase of any item requiring formal bids as cited by North 
Carolina General Statute, project contractor and the Governors Highway Safety Program must agree 
on the intent of the project contractors regarding bid award. This intent must state in a letter and in- 
clude the foUowing attachments: 

(1) an excerpt showing book number and page number from the official minutes conducted by the 
government body authorizing the purchase of the item; 

(2) an e.\cerpt from the official minutes which authorizes the advertisement for bids for the item, 
showing book number and page number; 

(3) one copy of the advertisement as run, showing name of newspaper and date; 

(4) one copy of each bid response. 

History Note: Statutory Authority G.S. I43B-360: 143-129; 
Eff Julv 1, 1978; 
Amended Eff November 1, 1991; February I. 1982. 

.0402 NONEXPENDABLE PROPERTY ACCOL>,TABILITV RECORD 

Project contractors purchasing nonexpendable equipment must submit the necessary' forms as directed 
bv the Governor's Highway Safety Program with the claim of reimbursement. 

History Note: Statutor\- .Authority G.S. 1 43 B- 360; 
Eff July I. 1978: 
Amended Eff November I, 1991; February' I. 1982. 

.0403 DISPOSITION OE NONEXPENDABLE EQUIPMENT 

Project contractors disposing of nonexpendable equipment must request permission to do so on the 
appropriate form indicating the equipment and the method of proposed disposition. 

History Note: Statutory Authority G.S. I43B-360; 
Eff Julv /, 19-78; 
Amended Eff November I. 1991; Februmy I. 1982. 

.0404 STATUS OF NONEXPENDABLE EQUIPMENT 

Project contractors must submit reports of the status of nonexpendable equipment annually on the 
appropriate form. 

History Note: Statutory .Authority G.S. 143B-360: 
Eff Julv 1, 1978: 
Amended Eff November 1, 1991: Febniary 1, 1982. 

SECTION .0500 - VEHICLE SPECIFICATIONS 

.0501 POLICE VEHICLE SPECIFICATIONS 
.11502 AMBULANCE SPECIFICATIONS 

Histon- Note: Statutory Authoritv G.S. 143B-360; 
Eff July /. 1978: ' 
.Amended Eff. February 1 , 1982; 
Repealed Eff November I, 1991. 



6:16 NORTH CAROLINA REGISTER November 15, I99I 1250 



FINAL RULES 



.0504 AMBULANCE VEHICLE INSPECTION 

fUston' Sote: Statutory Authority G.S. J43B-360; 
Eff. July I, 1978; ' 
Amended Eff. February 1 , 1982; 
Repealed E.ff November I, 1991. 

SUBCHAP lER 31 - RILES AND REGULATIONS GO\ ERNING THE LICENSESG OF 
COMMERCIAL DRH ER IRAINING SCHOOLS AND INSIRLCTIONS 

SECTION .0300 - SCHOOL LOCATION: PHYSICAL EACILITIES: 
AND COURSES OE INSTRUCTION 

.0302 OEEICE 

The office shall be the principal place of business, in the same location as but ph\ sically separated 
from the classroom facility, and must be sufficient for conducting all business related to the operation 
of the school including, but not limited to: 

( 1) facilities for conducting personal interviews; 

(2) storage of all records required for the operation of the school; 

(3) secretarial or telephone answering service available for a minimum of six hours between 9:00 a.m 
and 5:00 p.m. on normal business days; 

(4) a copy of North CaroUna Motor Vehicle Laws Chapter 20. 

Uiston- Note: Statutory Authoritv G.S. 20-322 through 20-324; 
Eff. Julv 2, 1979; ' 
Amended Eff November I. 1991: June I, 1982. 

.0303 CLASSROOM FACILITY 

Classwork can only be conducted in locations approved by the Division of .Motor Vehicles. The 
classroom facility shall meet the following minimum requirements: 

( 1 ) a minimum o\erall size of not less than 120 square feet (which includes at least 70 square feet for 
the instructor and his equipment and at least 12 square feet for each student); 

(2) lighting, heating, and ventilation systems that are in compliance with all state and local laws and 
ordinances including, but not limited to, zoning, public health, safety, and sanitation; 

(3) seats and writing surfaces for aU students; blackboards \isible from all seats; charts, diagrams 
mock-ups and pictures relating to the operation of motor vehicles, tratTic laws, physical forces, ant 
correct driving procedures; a copy of the Dri\'er's Handbook published by the Division for each 
student; and a textbook from the approved list for each student; and 

(4) restroom facilities sufficient for the class size must be provided. 

Histon' .\ote: Statutorv Authoritv G.S. 20-322 through 20-324; 
Eff July 2, 1979; ' 
Amended Eff November 1, 1991: April I. 1989: June 1. 1982. 

.0307 COl RSES OE EVSTRUCTION 

Commercial driver training schools are authorized to teach the following courses: 
(1) For unlicensed persons 18 years of age or older, a course as follows: 

(a) Classroom Instruction. A minimum of six hours, includmg (but not Umited to) rules of the roai 
and other laws and regulations affecting the operation of motor vehicles, safe dri\ing practices 
pedestrian safety, and the general responsibilities of the dri\ er. 

(b) Behind-the-\VheeI Instruction. A minimum of six hours, including instruction and practice ii 
all the basic physical skills necessary' for proper control of a motor veliicle in aU normal drivin 
situations, such as starting, stopping, steering and turning, controlling the vehicle in traffic 
backing, and parking. 

(c) A person holding a valid learner's permit issued by the Driver License Section of the Divisioi 
shall not be required to take the six hours of classroom instruction set forth in Subparagraph (a 
of this Paragraph. 



1251 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



(d) A person holding a valid learner's permit or driver's license issued by the Driver License Section 
of the Division may contract for any portion of the six-hour behind-the-wheel instruction. 

(2) For licensed persons a course for purposes of dnver improvement, such as improving their 
knowledge and skill in the operation of a motor vehicle. 

(3) For unlicensed persons under the age of 18 years, a course which must be approved by the 
Commissioner and the State Superintendent of Public Instruction as follows: 

(a) Classroom Instruction. Does not include workbook assignments or other work out of the 
presence of an instructor. A minimum of 30 hours, consisting of instruction in: 

(i) highway transportation: its social and economic influences upon life in /Vmerica; 

(ii) drivers: their physical and mental characteristics and how their capabihties and limitations 

influence the traiTic scene; 
(iii) the automobile: its construction, maintenance, and safe operation; 
(iv) traffic law and enforcement: laws of nature and man-made laws; and their relationship to 

traffic safety; 
(v) pedestrians and bicycles: their influence upon the traffic scene; and 
(vi) engineering: its influence upon automobiles, highways, traffic controls, and people, 
(vii) driving while impaired; six hours of instruction on the effects of drinking upon driving and 

upon accident and death rates; and 
(viii) rights and privileges of handicapped persons; their rights to use flags, placards, cards, Ucense 

plates, and parking places. 

(b) Behind-the-Whecl Instruction. A minimum of six hours, actually under the wheel, including: 
(i) familiarization with the automobile; the use of its controls; and the development of skills es- 
sential to safe operation in traffic: and 

(ii) driving in traffic with the instructor in a dual control car to de\elop abilities needed to follow 
the soundest course of action in responding to complex situations. 

(c) Restrictions: 

(i) Behind-the-Wheel instruction shall be offered to a student only after he has successfully com- 
pleted the classwork section. If a student has contractL-d for both classwork and behind-the- 
wheel trainmg, behind-the-wheel training may begm after classwork starts and before classwork 
has been completed. At no time should a student be taken out of class to attend behind-the- 
wheel training. 

(ii) No student shall operate a motor vehicle upon any public street or highway unless such stu- 
dent shall have in his immediate possession a valid Restricted Instruction Permit issued by the 
Division. 

(iii) No more than three hours of behind-the-wheel training shall be given in any one day. A 
written record indicating the date and time of this training should be kept on fJe for each stu- 
dent. The record must be signed by the student and not include observation of other students. 

(d) Other requirements: 

(i) Plans for the content of the curriculum, its organization, and presentation shall be submitted 
on Form SBrS-610 for the approval of the commissioner and the State Superintendent of 
Public Instruction. In addition, lesson plans for each of the 30 hours must be submitted. This 
course should meet the minimum requirements of the Dri\'er Education Course (No. 881, see 
page 16) of the North CaroUna Department of Pubhc Instruction. For further information, see 
"Driver Education, A Manual for Instructors" (State Department of Public Instruction, PubU- 
cation Number 288). 

(ii) Textbooks for use in the classwork section are to be chosen from those approved by the State 
Superintendent of Pubhc Instruction. 

(iii) Instructors must be approved by both the Commissioner and the State Supcrmtendent of 
Public Instruction. 

(iv) All expenses incurred in offering and teaching these courses shall be paid by the persons en- 
rolled therein or the school offering the course. 

(v) A student may enroll for either the classroom work or behind-the-wheel instmction, or both. 
A school may accept certification of satisfactory completion of classroom instruction from any 
school authorized to offer such a course, provided the certificate (Form SBTS-611A) is signed 
by the principal of the public school, or the superintendent of the administrative unit of wliich 
it is a part, or the executive officer of a non-public secondan' school. All SBTS-611A forms 
should be mailed or taken directly to the high school for completion by the commercial school 
owner or instructor. 1,'nder no circumstances should the form be given to the student. 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1252 



FINAL RULES 



(vi) Schools offering this course shall issue to their students upon satisfactory completion of either 
or both parts of the course a certificate furnished by the Division (Form SBTS-611). This cer- 
tificate \enfies only the training taught by the commercial school. The student's name on this 
certificate must be as it appears on his birth certificate. Schools shall be accountable to the 
Division for all certificates issued to them. 

(\iij The student, upon submitting certification of satisfactory completion of both parts of the 
driver education course, shall be eligible for licensing as provided by law. Such certification may 
be from either or both a public or non-pubhc secondary school or a commercial driver training 
school. 

(\iii) Schools shall submit reports to the Dnision, as may be required by the Division: and their 
books and records shall be open to inspection by Division representatives at all reasonable times, 
(e) A person satisfactorily completing the 30 and six hour course who desires additional training 
may contract for any portion of the si,\-hour behind-the-wheel instruction. 

(4) For licensed persons taking a course offered by a restricted commercial driver training school, the 
following courses are authorized: 

(a) curriculum for evaluation and improvement for licensed adult drivers only, utilizing over-the- 
road observation in vehicles not owned by the school or equipment such as driving simulators; 

(b) professional curricula, including one or more of the following: 
(i) police pursuit driving; 

(lij auto-cross dri\mg; 

(iii) emergency-vehicle driving: or 

(iv) road and track racing. 

(5) Instructor training program requirements: 

(a) school must be licensed one full year prior to approval: 

(b) all work must be with an instructor hcensed as an Instructor Tramer; 

(c) submit a proposed plan of operation outlining the training schedule, including: 
(i) teaching methods, 

(ii) writing lesson plans, 

(ui) review of Rules and Regulations Governing the Licensing of Commercial Driver Training 

Schools and Instructors, 
(iv) use of audio visual equipment and teaching aids, 
(v) familiarization of commercial school forms, and 
(vi) names of Instructor Trainers. 

Ifiston \o[e: Statutory Authority G.S. 20-322 through 20-324; 
Eff. July 2. 1979; 

Amended Eff. Sovember I. 1991: April I. I9S9: 
May I. I9S7: March I, I9S4. 

SECTION .0500 - REQIIREMENTS AND APPLICATIONS FOR DRI\ ER 

TRAINLNG LSSTRLCTOR 

.0501 REQUIREMENTS 

(a) Each instructor of a commercial dn\er trainmg school or branch shall: 
(1) be of good moral character: 
(2| have at least four years of experience as a licensed operator of a motor vehicle: 

(3) not have been convicted of a t~elon_\' or con\icted of a misdemeanor invoh'ing moral turpitude 
in the ten years immediately preceding the date of application: 

(4) not have had a revocation or suspension of his driver's license in the four years immediately 
preceding the date of application: 

(5) have graduated from high school or hold a high school equi\alency certificate; 

(6) not ha\'e had convictions for moving violations totaling seven or more points in the three years 
preceding the date of apphcation: 

(7) have completed the two-semester hour, college credit preparatory' course tor teachers: an 
equivalent course appro\ed b\' the commissioner, or an Instructor 1 raining Program conducted 
by an approved Commercial Driver Training School; 

(S) successfully complete the written test administered by a Driver Fducation Specialist: (.Allowed 
only one retest) 



125^ 6:16 NORTH CAROLISA REGISTER November 15, 1991 



FINAL RULES 



(9) successfully complete the Miller Road Test given by a Driver Hducation Specialist; (Allowed 

only one retest) 
(10) be gi\en a three month probation period until evaluated and recommended by a Driver Edu- 
cation Specialist. 

(b) An apphcant may apply for an instructor's learner's permit which would be valid for three 
months. To be eligible for an instructor's learner's permit, the applicant shaU meet requirements in 
Paragraph (a) (1) through (6); and shall: 

(1) submit an Instructor Application with an eight dollar ($8.00) application fee, copy of high 
school diploma or high school equivalency certificate, and physical examination form; 

(2) successfully complete 40 hours of classwork as a student at an approved commercial driver 
training school to consist of 

(A) 30 hours in the basic driver education classwork; 

(B) an additional 10 hours in practice teaching, writing lesson plans, review of Rules and Regu- 
lations Governing the Licensing of Commercial Driver Training Schools and Instructors, use 
of audio visual equipment and teaching aids and familiarization with commerci;d school forms; 

(3) successfully complete six hours of behind-the-wheel training as a student at an approved com- 
mercial driver training school; 

(4) successfully complete six hours of observation of behind-the-wheel instruction of a new driver 
by a licensed instructor trainer; 

(5) successfully complete the written test administered by a Driver Education Specialist; (Allowed 
only one retest) 

(6) successfully complete the Miller Road Test given by a Driver Education Specialist; (/Vllowed 
only one retest) 

(7) shall after completing Paragraph (b)(1) through (6) practice teach in the presence of an in- 
structor trainer; 

(8) successfully complete two hours of classroom instruction while being obser\'ed by a Driver 
Education Specialist; 

(9) successfully complete two hours of behind-the-wheel instruction while being observed by a 
Driver Education Specialist; 

(10) be recommended by a Driver Education Specialist to receive an instructor's license. 

(c) An instructor at an appro\cd commercial driver training school may apply for an Instructor 
1 Vainer license. The Instructor Trainer shall: 

(1) have five consecutive years as an active licensed instmctor; 

(2) submit an application for Instructor Trainer I icense with a fee of eight dolhirs ($8.00); 

(3) complete two hours of classroom observation by a Driver Education Specialist while trauiing 
instructors, not driver education students; 

(4) complete two hours of behind-the-wheel observation by a Driver Education Specialist u hile 
training instructors, not driver education students; 

(5) successfully complete the written test administered by a Driver Education Specialist; (.Allowed 
only one retest) 

(6) successfully complete the Miller Road Test given by a Driver Education Specialist; (Allowed 
only one retest) 

(7) be recommended by a Driver Education Specialist; 

(8) must rcqualify each school year. 

History Note: Statutory Authority G.S. 20-322 through 20-324; 
Eff. July 2, 1979; 

Amended Eff. November I, 1991; September I, 1990; 
April I. 1989; February 1, 198S. 

CHAPTER 5 - ASSISTANT SECRETARY FOR MANAGEMENT 

SUBCHAPTER 5A - ALTO.MATED DATA PROCESSENG 

.0002 FEE SCHEDULE 

The following fee schedule is in effect: 

(1) full file copy on continuous paper at fifty dollars ($50.00) per one thousand records; 

(2) full file copy on magnetic tape at seven dollars ($7.00) per one thousand records; 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1254 



FINAL RULES 



(3) selected listing on continuous paper [items listed in (2) through (6) of Rule .0001 of this 
Subchapter] at fift\ dollars ($50.00) per one thousand records, or a minimum charge of two hun- 
dred fifty dollars (S250.00), whichever is greater: 

(4) selected magnetic tape copy [items listed in (2) through (6) of Rule .0001 of this Subchapter] at 
twenty doUars ($20.00) per one thousand records, or a minimum charge of two hundred fifty dol- 
lars ($250.00), whichever is greater. 

Ifiston Xote: Statutory Authoritv G.S. 20-43; 20-50; 20-56; 
Eff. July I. 1978; ' 
Amended Eff. Xovember 1 , 1991. 

SL BCH.\PTER 5B - FISCAL 

SECTION .0100 - .\DMIMSTRATION 

.0101 FISCAL SECTION OPERATIONS 

The fiscal section operates under the E.xecutive Budget Act and the Budget Manual of the Office of 
State Budget and Management (OSBM). lire rules fded by OSBM control the operations of the fiscal 
section, except to the extent that the following rules within this Subchapter supplement those mles 
Copies of the manual may be obtained from the Assistant Secretary' for Administration for an estab- 
Ushed fee. 

Uiston Xote: Statutory Authority G.S. 143-1; 143-28; 143B-I0; I43B-348; 
EffJulvl,1978; 
Amended Eff Xovember I. 1991. 

.0105 RE.Mirr.\NCE FOR GROUP HEALTH INSLRANCE CO\ ERAGE 

The fiscal section does not accept personal checks in payment of premiums due from employees for 
group health insurance coverage. Payment, other than those handled on a payroU deduction basis, 
should be made by money order, cashier s check, certified check, or by personal deliverv' of cash to the 
insurance and compensation unit for which a receipt will be issued. 

Histor; Xote: Statuton' Authoritv G.S. 143-2; I43B-I0(j); 
Eff July I. 1978; ' 
Amended Eff Xovember 1 . 1991 . 

SECTION .0200 - AUDITS OF CONTRACTING PARTIES 

.0201 PRE- AUDIT: FINANCIAL CAPABILITIES 

•All contracting firms, agencies, or recipients of grants or loans, except those whose contract was 
awarded as a result of the bidding process and those classified as local go\emments reporting under the 
Single Audit Act, who are entering into a contract or agreement with the Department of Transportation 
shall submit to the external audit branch of the Department of Transportation their current balance 
sheet, income statement, statement of net worth, chart of accounts, and any other data that may be 
determined to be necessary by the auditors, in order that the auditors may render an opinion as to 
whether the tirm is financiaU>' capable of fulfilling the terms of the contract or agreement. The auditor s 
findings wiU be considered by the controller who, in conjunction with the Assistant Secretan,' for Ad 
ministration, will report thereon to the appropriate contracting officer. 

Histo/y .Xote: Statuton' Authoritv G.S. 143-2; 143B-I0(j); 
Eff July f 1978; ' 
.Amended Eff. Xovember I. 1991. 

.0202 PRE-AUDIT: ACCOLNsTING SYSTEM 

.•Ml contracting tirms. agencies, or recipients of grants or loans, except those whose contract wa: 
awarded as a result of the bidding process and those classified as local governments reporting under the 
Single Audit .Act, shall submit their accounting systems to a review by the external audit branch ot th 
Department of Transportation in order that the auditors may determine that the accounting system i; 
capable of segregating and maintaining costs apphcable to the contract, grant or loan. 



1255 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



History Note: Statutory Authority G.S. 143-2; I43B-I0(j); 
Eff. July I, 1978; 
Amended Eff. November /, 1991. 

.0205 WAFV ER OF AIRPORT PRE-AUDIT 

.0206 INFORMATION IN LIEU OF AIRPORT PRE AUDIT 

History Note: Statutory Authority G.S. I43B-I0(j); 1/3-28.10; 
Eff. July I, 1978; 
Repealed Eff November I, 1991. 

SECTION .0300 - ADOPTION OF FEDERAL POLICIES 

.0301 ADOPTION OF U.S.D.O.T. FEDERAL AUDIT GUIDELINES 

(a) In order to provide consistency and uniformity in the administration of all contracts, these the 
following guidelines including any subsequent amendments or editions of the same are hereby adopted 
and incorporated by reference pursuant to G.S. I50B- 14(a) and (c) as rules of the North Carolina De- 
partment of Transportation to be used as audit guidelines on non-federaUy funded projects. Policies 
in effect on the date a contract is entered into will govern the contract for the duration of the contract. 
Copies of the below listed items are available for inspection in the Office of the Assistant Secretary for 
Administration. 

(b) The guidelines hereby adopted are: 

(1) Federal- Aid Highway Program Manual: 



Volume Chapter Section Subsection 



4 
4 



3 
5 



2 
2 



Reimbursement for railroad 
work -- Issued 8-5-88 
Payroll and related expense of 
public employees; general 
administration and other 
overhead; and cost accumulation 
centers and distribution 
methods -- Issued 1-26-81 
Administration of negotiated 
contracts -- Issued 1-21-80 
Administration of highways 
planning projects -- 
Issued 11-5-86 

Utility relocations, 
adjustments and reimbursements 
-- Issued 11-11-88 



6:16 NORTH CAROLINA REGISTER November 15, 1 99 1 



1256 





FINAL RULES 


(2) Code of Federal 


Regulations : 




Title 48 Part 31.2 




Contracts with commercial 
organizations -- 
Issued 4-28-89 


Title 49 Part 18 




Uniform administrative 
requirements for grants 
and cooperative agreements 
with state and local 
governments (USDOT Common 
Rule) -- Issued 3-11-88 


Title 23 Part 172 




Administration of 

Engineering and Design 

related services contracts 

Issued 4-30-91 1 



(3) Office of Management and Budget 
Circulars : 
0MB Circular A-21 



0MB Circular A-87 



Cost principles for 
educational institutions 
Issued 3-6-79 

Cost principles for state 
and local governments 
Issued 1-1-81 



0MB Circular A-102, Attachment A-0 Uniform administrative 

requirement for 
grants-in-aid to state and 
local governments 
Issued 1-1-81 



0MB Circular A-102 (Revised) 



0MB Circular A-110 



0MB Circular A-122 



Grants and cooperative 
agreements with state and 
local governments 
Issued 3-11-88 

Grants and agreements with 
institutions of higher 
education, hospitals and 
other non-profit 
organizations 
Issued 7-1-76 

Cost principles for 









non-prorit organ 
-- Issued 7-80 


iza 


cions 


0MB 


Circular 


A-128 


Audits 


of state 


and 


local 








governments -- 












Issued 


4-12-85 






1257 


6:16 


NORTH CAROLINA REGISTER 


November 


15, 


1991 



FINAL RULES 



0MB Circular A-133 



Audits of institutions of 
higher education and other 
non-profit organizations 
Issued 3-8-90 



0MB Compliance Supplements 



USDOT Programs only 
Issued 9-90 



(4) Urban Mass Transportation 
Administration Circulars 
UMTA C 4220. IB 



UMTA 



5700.1 



Third party contracting 
guidelines -- Issued 5-5-88 

Requirements and 
responsibilities for 
indirect cost 
proposals/cost allocation 
plans for technical 
studies and capital grants 
Issued 5-24-83 



UMTA 



7005.1 



Documentation of private 
enterprise participation 
required for Section 3 & 9 
programs -- Issued 12-5-86 



UMTA 



7010. 1 



Capital cost of 
contracting -- 
Issued 12-5-86 



(5) Department of Treasury Circular: 

Circular 1075.1 Part 205 Withdrawal of cash from 

the Treasury for advances 
under Federal grant and 
other programs -- 
Issued 10-14-77 



(6) Federal Single Audit Act: 



Issued 10-11-84 



(7) North Carolina Single Audit 
Implementation Act: Issued 1987 

(8) State Compliance Supplements NCDOT Program only - Issued 

for FY 90/91 

(9) NCDOT Rules and Regulations for 
Major Professional or Specialized 
Contracts 

Hisloiy Sote: Statutoty Authority G.S. I43B-I0; I43B-34S; 



6:16 NORTH CAROLINA REGISTER November 15. 1 99 1 



I25S 



FINAL RULES 



Eff. July I, 1978; 

Amended Eff. November I, 1991. 

.((302 ADOPTION OF FEDERAL AUDIT Gl IDELPsES 
.0303 ADOF riON OF L ..M.T.A AL DFF GLlDELrsES 

History Mote: Statutory Authority G.S. I43B-I0(j); 
EffJulvl. 1978: 
Repealed Eff. November I. 1991. 

SECTION .0500 - MOVING PROCEDURES 

.0501 MOVING POLICY 

(a) The Department of Transportation vvill pay an employee's moving expenses when a change ot 
residence is deemed to be in the best interest of the department, and when such a change is required 
as a resuh of a promotion or by a change in assignment involving a transfer of the employee for th 
advantage and convenience of the department, and the new duty station is 35 miles or more from th 
empIo\ee's existing (or prior) duty station. 

(bj The Department of Iransportation adheres to the policy for employee's moving expenses estab 
hshed b\ the Office of State Budget and Management, except as modified as follows; 

( 1 ) The mover is to return his completed bid to the employee. 

(2) The department does not advance the employee any money for mo\Lng expenses, rather th' 
department has elected to issue a purchase order for the mo\'e and will make payment directl} 
to the mover upon completion of the move. 

Histon Note: Statutoty Authority G.S. 143-2: I43B-I0(jl; 
Eff. July I. 1978: ' 
Amended Eff. November I. 1991. 

.0502 M()\ ING POLICY; MOVING PACKET 

.0503 M()MN(. POIJCY: AUTTIORI/.VHON TO MOVE FORM (601-EXP) 

Ifistory .\ote: Statuton' Authority G.S. 143-2: I43B-I0(j): 
Eff July I, 1978: ' 
Repealed Eff November I. 1991. 

CHAPTER 6 - ASSISLANT SECREI ARV FOR PLANNING 

SUBCHAP lER 6B - PUBLIC TRANSPOR I ATION AND RAIL PROGRAM 

SECTION .0100 - GENERAL PROMSIONS 

.0102 LEAD STATE AGENCY 

.0103 DIRECTOR OF PUBLIC TRANSPORTATION 

History Note: Statutory- .Authority G.S. 136-44.20: 
Eff July /. 1978: ' 
Repealed Eff November I. 1991. 

SECTION .02(M> - 1 ECirVICAL ASSISTANCE 

.0203 ASSISLANCE IN CONDUCTING PLANNING AND .MANAGEMENT STUDIES 

Fligible pubhc agencies may receive assistance on technical matters during the conduct of publi 
transportation planning and management studies. Requests for assistance shall be made to the Dt 
partment of Transportation prior to the start of the study and the requests shall state the nature ot th 
technical assistance. The olTer of assistance is made contingent upon the availability of staff. 



Histon- Note: Statutory Authority G.S. 136-44.20: 
Eff July I. 1978;' 




1259 6:16 NORTH CAROLINA REGISTER 


November 15, 1991 



FINAL RULES 



Amended Eff. November I, 1991. 

.0204 ASSISTANCE IN OPERATIONAL TECHNIQUES 

Elieible public agencies may receive advice on administrative and operational aspects of public trans- 
portation systems that have received state or federal fmancial assistance. Requests for assistance shall 
be made in writing to the Department of Transportation stating the nature of the assistance. The offer 
of assistance is made contingent upon the availability of staff. 

History Note: Statutory Authority G.S. J 36-44.20; 49 U.S.C. 1602; 
Eff. July I. 197 S; 
Amended Eff . November 1, 1991. 

.0205 ASSISTANCE IN TRAINING ACTEV ITIES 

Eligible agencies may receive training assistance on operational and administrative aspects of public 
transportation systems. Requests for assistance shall be in writing to the Department of Transportation 
stating the nature of the assistances. The offer of assistance is made contingent upon the availabihty 
of staff. 

History Note: Statutory Authority G.S. 136-44.20; 
Eff November I. 1991. 

SEC HON .0300 - FES ANCIAL ASSISTANCE 

.0302 FESANCIAL ASSISTANCE FOR PLANNING AND MANAGEMENT 

Eligible agencies may receive state and or federal funds for the planning, management, engineering, 
design, and evaluation of pubhc transportation projects. Requests for state fmancial assistance shall 
be made Ln writing to the Department of Transportation. 



History Note: Statutory Authority G.S. 136-44.20; 143B-10(j); 
EffJulyl.l97S: 
Amended Eff. November 1 , 1991 . 



.0303 FESANCIAL ASSIST.ANCE FOR CAPITAL IMPROV EMENTS 

Eligible agencies may receive state and federal fmancial assistance in fmancing the acquisition, con- 
stmction, reconstruction, and improvement of facilities and equipment for use, by operation or lease 
or otherwise, in public transportation services. Requests for state and federal financial assistance shall 
be made in writing to the Department of Transportation. 

History Note: Statutory Authority G.S. 136-44.20; 
Eff July I. 1978; 
Amended Eff. November /, 1991. 

.0304 FESANCIAL OPERATING ASSISTANCE 

Eligible agencies may receive state and federal fmancial assistance in fmancing either the operation of 
public transportation service or projects of limited duration which demonstrate innovative approaches 
in the provision of local or area-wide public transportation services. Requests for state and federal fi- 
nancial assistance shall be made in writing to the Department of Transportation. 

History Note: Statutory Authority G.S. I43B-I0(j); 136-44.20; 49 U.S.C. 1604; 
Eff July 1, 1978; 
Amended Eff. November 1 . 1991 . 

SI BCHAPTER 6C - DFV ISION OF AERONAUTICS 

SECTION .0100- FACILITY DEVELOPMENT - FESANCIAL ASSISTANCE PROGRAM: 

GENERAL PRO\ ISIONS 

.0107 RETROACTEV E RELMBURSEMENT 



6:16 NORTH CAROLINA REGISTER November 15. 1991 1260 



FINAL RULES 



In its discretion, the Department may grant state financial assistance for any construction commenced 
prior to the execution of a State .Aid to Airports Grant Agreement, provided that concurrence is re- 
ceived from the Department prior to the start of construction. Retroactive reimbursement for land 
acquisition and planning will be eligible for a period of time consistent with policies and standards of 
the Federal A\iation Administration. 

History Xote: Statutory Authority G.S. 63-66; 63-68; 
Eff. July I, 1978; 
Amended Eff. Sovember I, 1991. 

.0109 PRO.JFXT APPLICATION PROCEDLRES 

(a) Allocations under the State Aid to /Virports Program are reviewed by the Aeronautics Council 
and approved by the Secretar.' of Transportation as part of the Transportation Improvement Program 
(TIP). 1 he Aviation Element of the TIP is a five year allocation of funds for specific projects and grant 
amounts. The llrst year of the program is a firm commitment of expenditures based upon Legislative 
approval. The remaining four years of the program represent tentative allocations for planning pur- 
poses and are subject to revision based upon actual Legislati\e allocations for State Aid to Airports. 

(b) Sponsors are encouraged to submit proposed projects as part of the TIP formulation process 
which begins each Spring. Ihe .-\\iation Element of the TIP is fmalized following Legislative approval 
of allocations for State Aid to .Airports. Proposed projects which are submitted outside of the TIP 
formulation process may not receive consideration until the next year's formulation is underway. 

(c) Applications for State Aid to .Airports shall be made on the appro\-ed Request for .-\id Form to 
the Director of Aeronautics. Applications shall contain: 

(1) an executed state financial assistance Request for Aid Form, 

(2) a current airport layout plan depicting the proposed project, 

(3) a detailed cost estimate showing construction quantities and their costs, and 

(4) a narrati\'e statement outhnmg the facts about the project and giving the sponsor's rationale for 
its need. 

History^ Xote: Statuton Authoritv G.S. 63-66; 63-70: I43B-350(fJ,fgj; 143B-355: 
Eff. July I, 1978; 
.Amended Eff. Sovember 1. 1991. 

.0110 ENMRONMENEAE ASSESSMENT 

Inder the pro\"isions of the North Carolina En\ironmental Policy Act, each State .Aid to /Virports 
project shall be renewed to determine if. and to what degree, assessment of the en\ironmental impact 
of the project is required. The Director of Aeronautics will determine if the project requires full envi- 
ronmental assessment and coordination. Should environmental assessment be necessary, the sponsor 
shall prepare an assessment and circulate it to state agencies through the State Clearinghouse and to 
appropnate federal agencies through direct submission. The sponsor shall then answer all substanti\'e 
questions and comments and recei\-e the concurrence of the commenting agency that the responses are 
acceptable. Lpon submission of the assessment and all comments, the Director of Aeronautics will 
complete any further review and approvals needed. The Secretary of Transportation will then deter- 
mine if State funds may be expended on the project within the pro%isions of the North Carolina Fn- 
\ironmental Pohcy .Act. 

History .\ote: Statutory Authoritv G.S. 63-66; 63-68; 1/3A-4; 143B-3S0(f),(gj; 
Eff July I, 1978; ' 
Amended Eff Xoxember I. 1991. 

.0112 AEEOWABEE PRO.JECT COSTS 

Fhgible items of work and state funds amounts will be stipulated in the Grant Agreement mutually 
executed by the Department and the sponsor. Allowable project costs and detailed eligibiHty of work 
elements are contained in the current issue of the "State .Aid to Airports Program Guidance 
Handbook" which is incorporated by reference into the Grant Agreement and made a part of the 
project procedures. 

lliston.- Xote: .Authority G.S. 63-66: 63-67: 63-68; 
Eff July I, 1978; 



1261 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



Amended Eff. November I, 1991; March I, 1982. 

.0123 SPONSOR CERTIFICATION OF LOCAL MATCHING FL^SDS 

It is the policy of the Department that allocations of State Aid to Airports funds be made only for 
current projects which can get underway without delay. Sponsors requesting funds should have the 
local matching funds in their approved budget or be able to approve the funds on an immediate basis. 
Upon arrival of a State Aid to /Virports allocation and its placement in the TIP, the sponsor shall have 
a limited amount of time, but no less than 60 calendar days to certify the availabihty of the local share 
of funds for the project. Failure to certify funds availability on a timely basis may result in the can- 
cellation of the allocation by the Department. 

History Nole: Statutory Authority G.S. 63-66; 63-68; 
Eff. November I, 1991. 

.0124 LIMITS ON USE OF ALLOCATED FUNDS 

/Vllocation of state funds for a State Aid to /Virports project is on the basis of a specific amount of 
funds for a specific work element. If all approved funds are not needed for the approved work element 
the excess funds will be returned to the State Aid to Airports Program unobligated balance. Sponsors 
may not expect to transfer current funds to other work elements unless the transfer has been reviewed 
and approved by the Department. Such approval will be made only after application of the State Aid 
to Airports priority system and the project is of sufficiently high priority compared to other pending 
project requests. 

History Note: Statutory Authority G.S. 63-66; 63-68; 
Eff November I, 1991. 

.0125 TIME LIMITS ON CONSTRUCTION OF THE PROJECT 

It is the pohcy of the Department that all projects receiving State Aid to Airports get underway and 
be completed without undue delay. The Grant Agreement for the project will stipulate the completion 
time expected for the project. The Agreement will normally provide at least one year from the time 
of the offer of the Grant Agreement to undertake and complete the project. In most cases, the maxi- 
mum time allowed will be two years, unless the project involves complex procedures for which addi- 
tional time is normally needed. Failure to complete the project within the stipulated time period may 
3e cause for cancellation of the project. 

History Note: Statutory Authority G.S. 63-66; 63-68; 
Eff November I. 1991. 

.0126 REQUEST FOR EXTENSION OF TLME TO COMPLETE PROJECT 

in the event a project is not completed within the stipulated time frame as contained in the Grant 
Vgreement, no state funds will be granted for work completed after the completion date. On a case 
case basis, the time for completion may be extended if extenuating circumstances prevent the 
ponsor from completion by the date specified. In order to extend the time for completion, the sponsor 
nust submit a written request for time extension in the format specified by the Department explaining 
n detail the reason why the project was not completed by the specified completion date. In its dis- 
retion, the Department may approved the extension and specify a new completion date. Only under 
xtraordinary circumstances will more than one time extension be granted on the same project. 

History Note: Statutory Authority G.S. 63-66; 63-68; 
Eff November I, 1991. 

(•127 SANCTIONS FOR NON-PERFORMANCE ON STATE AID PROJECTS 

In the event a sponsor is not responsible to requests to complete a project, provide financial doc- 
imentation, has a pending rcqurred refund on another project, or otherwise is grossly deficient in the 
onduct of a project, the Department reserves the right to withhold new grants or suspend existing 
rants until the project deficiency has been corrected. 

History Note: Statutory Authority G.S. 63-66; 63-68: 
Eff November I, 1991. 



6:16 NORTH CAROLINA REGISTER Novembo 15, 1991 1262 



FINAL RULES 



.0128 STATE AID TO AIRPORTS PROGRAM GUIDANCE HANDBOOK 

Current procedures, description of eligible items, and supporting information for the conduct of State 
Aid to .\irports Projects is contained in the "State Aid to Airports Program Guidance Handbook". 
The Handbools; is a\ailable from the Department upon request. The Handbook will be updated peri- 
odically so users should confuTn that they have the current edition. 

History Sole: Statutory Authority G.S. 63-66; 63-68; 
Eff. November I, 1991. 

.0129 DEPARTMENT TO ACT AS AGENT FOR FEDERAL GRANT PROGRA.MS 

The Dep;u1mcnt is authorized under the provisions of North Carolina OS 63 to act as an agent for 
sponsors in their relations with the Federal Aviation Administration and other federal agencies. 
Sponsors which wish to have the Department act in their behalf should submit a written proposal de- 
tailing the type of assistance desired and the proposed role of the Department in obtaining this assist- 
ance. The proposal should be submitted to the Director of Aeronautics. 

History Sate: Statuion' Authority G.S. 63-66; 63-7 1 ; 
Eff. November I, 1991. 

.0130 FEDERAL FLOW IHROLGH ELIDING PROGRAMS 

For Fiscal \'ears 1990, 1991, and 1992 the Department has participated in the federal "State Block 
Grant Pilot Program". Under the terms of this program, federal funds for general aviation and reliever 
airports in North Carolina are provided to the Department, which is then responsible for determining 
the recipients of grant funds and administering the funding program. In general, federal flow through 
funding projects will be handled as nearl\' like State Aid to Airports projects as possible, though addi- 
tional steps and or certifications may be needed to meet specific federal requirements. 

Histoiy Note: Statutory- Authority G.S. 63-66; 63-7 1 : 
Eff November I, 1991. 

.0131 ST.\TE/FED PARTICIP.VFION R.ATES/FED FLOW IHROUGH FLN.D PROGRA.MS 

.Many federal flow through funding programs allow discretion on the part of the Department to set 
the federal fundmg share. For the State Block Grant PUot Program, the federal funding share has been 
set at SO percent of the final, ehgible project costs. State shares will correspond to those authorized 
under GS 63. 

Histoiy Note: Statutory .Authority G.S. 63-66; 63-7 1 ; 
Eff November I. 1991. 

.0132 PROCl REMENT OF CONSULTANTS FOR ENGINEERESG SERMCES 

North Carohna General Statute 143 specifies that, except under specific circumstances, engineering 
consultants shall be selected only on the basis of qualifications and that price shall not be a factor in 
this selection. No state funds wiU be pro\ided for anv engineering services not procured in accordance 
with GS 143. 

Histoiy Note: Statutory .-luthoritv G.S. 63-66; 
Eff. November I. 1991. 

.0L^3 PROHIBH ION/CONTRACTORS REMOVED/DIV HWTS PRE-QUALIFIED BIDDERS 

Contractors for State .Aid to .Airports projects are not required to be pre-t^ualified through any pro- 
cedure of the Department. Hovs-ever, it is the pohcy of the Department not to approve contractors on 
State r\id to .\irports projects who have been removed from the Di\ision of Highways pre-qualified 
bidder's hst for cause without subsequent reinstatement. It shall be the responsibihty of the sponsor 
and its consultant to advise potential bidders of this policy and to insure that contracts are not awarded 
to contractors who ha\e been disqualified from bidding on other programs of the Dep;u1mcnt. 

History Note: Statutory Authority G.S. 63-66; 
Eff. November /, 1991. 



1263 6:16 NORTH CAROLINA REGISTER November 15, 1991 



FINAL RULES 



.0134 HOSPITAL HELIPORTS 

A hospital heliport will be eligible for State Aid to Airports provided it is made available to the general 
public for use without undue restriction. Hospital heliports which are restricted to medical helicopter 
operations wiU be considered to be private facilities and are not eligible for State Aid to Airports. 

History Note: Statutory Authoritv G.S. 63-66; 
Eff. November 1, 1991. 

SECTION .0700 - STATE AIRPOR IS 

.0703 IRESPASS ON STATE AIRPORTS 

No person shall enter upon the runway(s), taxiway(s), aircnift parking apron(s), building(s), or adja- 
cent areas unless that person is a pilot, aircraft owner, passenger, or other person who has business on 
the airport directly related to the provision of air transportation services. 

History Note: Statutory Authoritv G.S. 63-72; 
Eff. November I, 1991. 

.0704 PROHIBITION AGAINST GROL^sD VEHICLES ON STATE AIRPORTS 

No person shall operate a ground vehicle on the runway(s), taxiway(s), aircraJ't parking apron(s), or 
adjacent areas unless prior permission has been obtained from the Director of Aeronautics. 

History Note: Statutorv .-lulhority G.S. 63-72; 
Eff November I, 1991. 

.0705 CLOSl RE OE STATE AIRPORTS DURING HOLRS OE DARKNESS 

The Billy Mitchell Airport at Frisco, NC and the Ocracoke Island Airport at Ocracoke, NC are closed 
to all flight operations between a time beginning 30 minutes after civil sunset and extending to a time 
ending 30 minutes prior to civil sunrise. 

History Note: Statutory .-luthoritv G.S. 63-72; 
Eff November I. 1991. 

.0706 COMMERCIAL ELIGHT OPERATIONS PROHIBITED WTHIOUT APPROVAL 

No person shall base or otherwise conduct commercial aeronautical activities from a state airport 
without the permission of the Director of Aeronautics. With regard to the Billy .Mitchell .-Virport at 
Frisco, NC and the Ocracoke Island .Airport at Ocracoke, NC, any such commercial operations shall 
also require the approval of the National Park Service operating through the Cape Hatteras Manage- 
ment Group in .Manteo, NC. 

History Note: Statutory Authoritv G.S. 63-72; 
Eff November I. 1991. 



6:16 NORTH CAROLINA REGISTER November 15. 1991 1264 



RRC OBJECTIONS 



1 he Rules Review Commission (RRC) objected to the following rules in accordance with G.S. 
/43B-30.2I c ). State agencies are required to respond to RRC as provided in G.S. 143D-30.2(di. 



Te 



mporaty Rules are noted by 



These Rules have already gone into effect. 



ADMIMSIRAIION 



State Con^truction 



/ SCAC 30F .0101 - Authority 

1 

I 



1 SCAC 30F .0301 
I .\CAC JOF .0302 
I XCAC 30F .0303 



\CAC 30F .0103 - Definitions 

\CAC 30F .0202 - Pre- Bid Conferences and Site Review's 
Definitions 

Overall Job Performance 
Interim Contractor Evaluation 
I SCAC 30F .0305 - Report Compilation 
I SCAC 30F .040/ - Post-Occupancy Evaluation 
1 SCAC 30F .0403 - Appeals of Assigned Eval or Disqual from Bidding 



AGRICLLRRE 

Plant Industn 

2 SCAC 4SE .010/ - Definitions 

ECONOMIC AM) COM.MLAH V DEX ELOPMKNT 

L-mployment and Training 

* 4 SCAC 20 B .0903 - Allocation of Grants 
.\'o Response from Agency 

* 4 SCAC 20B .0905 - Eligibility 
So Response from Agency 

* 4 .\CAC 20B .0907 - Cost Limitations Categories 
So Response from A^encv 

* 4 SCA C 20B .0908 -^Reporting 
So Response from Agency 

* 4 SCA C 20B .0909 - Performance Standards 
.\o Response from Agency 

* 4 SCAC 20B .091/ -^und Availability 
So Response from .Agency 

EDICATION 

Elementan" and SccondaiA' Education 

/6 SCAC 6B .000/ - School Bus Dri\ers 

/6 SCAC hD .0/03 - Graduation Requirements 

* /6 SCAC bE .030/ - Driver Training 
.Agency Responded 

ENMRONMEM , HEAE IH, AND NATl RAE RESOERCES 

Adult Health 



RRC Obieciion 


/O /7 9/ 


RRC Objection 


/0:/79/ 


RRC Objection 


/O /7 9/ 


RRC Objection 


10/7 9/ 


RRC Objection 


/O /7 9/ 


RRC Objection 


10/7 9/ 


RRC Objection 


/O /7 9/ 


RRC Objection 


/O /7 9/ 


RRC Objection 


/a /7 9/ 



RRC Objection /O /7 9/ 



A RRC Objection 
A RRC Objection 
A RRC Objection 
A RRC Objection 
A RRC Objection 
A RRC Objection 



S 22 9/ 
9 19 9/ 
S 22 9/ 
9:/ 9. 9/ 
S 22 9/ 
9/9 9/ 
\2 9/ 
/9 9/ 
22 9/ 
/9 9/ 
S 22 9/ 
9 19 9/ 



A RRC Objection 9 19 9/ 
ARRC Objection 9 /9 9/ 

A RRC Objection S 22 9/ 
9/9 9/ 



1265 



6:16 NORTH CAROLINA REGISTER November L\ 1 99 1 



RRC OBJECTIONS 



ISA NCAC I6A .0804 - Financial Eligibility 

i\'o Response from Agency 

Agency Responded 

No Response from Agency 
15A NCAC I6A .0806 - Billing the HIV Health Services Program 

No Response from Agency 

Agency Responded 

No Response from Agency 



Coastal Management 



ISA NCAC 
ISA NCAC 
ISA NCAC 
ISA NCAC 
ISA NCAC 
ISA NCAC 
ISA NCAC 
ISA NCAC 



7J .0301 - 
7J .0302 - 
7J .0402 - 
7M .0201 
7M .0202 
7M .0303 
7M .0403 
7M .0901 



Environmental .Management 

ISA NCAC 2D .1102 - Applicability 

ISA NCAC 2D .1208 - Operator Training Requirements 

Forest Resources 

ISA \CAC 9C .1007 - .America the Beautiful Grant Program 
Agency Revised Rule 

:lealth: Epidemiology 

ISA NCAC I9A .0202 - Control Measures - HIV 

Wadlife 

ISA NC.iC lOA .1001 - Particular Offenses 
.Agency Revised Rule 

HUMAN RESOl RCES 

10 NCAC 22M .0101 - Scope of Care Management 
10 NCAC 22M .0102 - Definitions 
NCAC22M .0103 - Target Population 
'0 NCAC 22M .0203 - .Assessment and Reassessment 

0204 - Care Planning 
0101 - Definitions for Confidentiality of Client Data 

0205 - Security of Records 
0208 - Client Access to Records 



A RRC Objection 

No A ction 
No Action 
ARRC Objection 

No Action 
No Action 



1/18/9 J 
2/25/91 
3/21/9! 
4/18/91 
I / 18/91 
2/25/91 
3/21/9 1 
4/18/91 



Who is Entitled to a Contested Case Hearing 

Petition J'or Contested Case Hearing 

Criteria for Grant or Denial of Permit Applications 

■ Declaration of General Policy 

■ Policy Statements 

■ Policy Statements 

■ Policy Statements 

■ Declaration of General Policy 



'0NCAC22M 
0NCAC22N . 
NCAC 22 N 
0NCAC22N 



-hildren's Ser\'ices 

NCAC 411 .0406 - Resporuibility for Training of Team Members 



ARRC Objection 
ARRC Objection 
RRC Objection 
RRC Objection 
RRC Objection 
RRC Objection 
RRC Objection 
RRC Objection 



9/19/91 
9/19/91 
10 1 17, 91 
I0il7,91 
10 1 17 ,91 
10/17,91 
10 1 17, 91 
10/17/91 



ARRC Objection 8/22/91 

No Action 9/19/91 

ARRC Objection 8/22/91 

No Action 9/19,91 



ARRC Objection 9/19/91 
Obj. Removed 9/l9i91 



RRC Objection 10, 17,91 



ARRC Objection 9/19/91 
Obj. Removed 9/19/91 



ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 



Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 



9/19/91 
9/19/91 
9/19/91 
9/19/91 
9/19/91 
9:19/91 
9/19/91 
9/19/91 



ARRC Objection 7/l8;9l 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



1266 



RRC OBJECTIONS 



Pending Correction 
Economic Opportunity 

* 10 \'CAC 5 IF .0/02 - Definitions 
No Response from Agency 

* 10 SCAC 5IF .0202 - Ineligible Activities 
No Response from Agency 

* 10 NCAC 5IF .0402 - Eligibility Requirements 
No Response from Agency 

* 10 NCAC 5 IF .050/"- Grant Agreement 
.Wo Response from Agency 

Facility Services 

/O NCAC 3 J .2905 - Personal Hygiene Items 

/O NCAC 3U .0604 - General Safety Requirements 

Agency Revised Rules 
10 SCAC 3U .0804 - Infectious and Contagious Diseases 

.igency Revised Rules 

Medical Assistance 



A RRC Objection 
A RRC Objection 
A RRC Objection 
A RRC Objection 



8/2219/ 



8/2219/ 
91/9/9/ 
8/2219/ 
91/919/ 
8/2219/ 
91/9/9/ 
8/22/9/ 
91/9/9/ 



RRC Objection /0i/7,9/ 
A RRC Objection 8/22/9/ 
Obj. Removed 9//9j9I 
A RRC Objection 8/22:91 
Obj. Removed 9//9'9/ 



/O NCAC 26I-I .0/08 - Reimbursement Methods! State-Operated Facilities RRC Objection lOi/7;9/ 
10 NCAC 50B .0305 - Deprixation A RRC Objection 8/22, 9/ 



.Agency Revised Rule 
Mental Health; General 

/() NCAC /4K .0/03 - Dejinitions 

.igency Revised Rule 
10 NCAC /4K .0320 - Incident Reporting 

Agency Revised Rule 
10 NCAC /4K .0337 - Emergency Care Permission 

.Agency Revised Rule 
10 NCAC /4K .035/ - Administration of .Medication 

Agency Revised Rule 
JO NCAC /4M .0206 - Day Services 

.Agency Revised Rule 
10 NCAC /4M .0209 - Community Resources 

.Agency Revised Rule 
10 NCAC /4M .0409 - Community Resources 

Agency Revised Rule 
10 NCAC 140 .03/0 - Provision of Appropriate Activities 

Agency Revised Rule 
JO NCAC /4P .0/0/ - Scope 

Agency Revised Rule 
/O NCAC /4P .0102 - Definitions 

.Agency Revised Rule 

JO NCAC /4Q .0/0/ - Policy; Rights Restrictions/ Interventions 

.Agency Revised Rule 
10 .\CAC /4R .0/04 - Seclusion Restraint! Isolation Time Out 

.Agency Revised Rule 
10 NCAC /4R .0/05 - Protective Devices 

.A^cncv Revised Rule 



Obj. Removed 8/22/91 



A RRC Objection 9//9i9/ 

Obj. Removed 9//9;91 

ARRC Objection 9!/9;9/ 

Obj. Removed 9;/9,9/ 

ARRC Objection 9'/9:9/ 

Obj. Removed 9j/9:9/ 

ARRC Objection 9l/9>9/ 

Obj. Removed 9:/9i9/ 

ARRC Objection 91/9/9/ 

Obj. Removed 9;/9i9/ 

ARRC Objection 9:/9:9/ 

Obj. Removed 9,79,9/ 

ARRC Objection 9//9;9/ 

Obj. Removed 9;/9,9/ 

ARRC Objection 9,79,9/ 

Obj. Removed 9i/9,9/ 

ARRC Objection 9n9i91 

Obj. Removed 9:/9,9/ 

ARRC Objection 9:/9 9/ 

Obj. Removed 9:/9:9/ 

ARRC Objection 9/ 19,9/ 

Obj. Removed 9//9,9/ 

ARRC Objection 9:/9 9/ 

Obj. Removed 9//9/9/ 

ARRC Objection 9/9,9/ 

Obj. Removed 9/ 19/91 



1267 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



RRC OBJECTIONS 



10 NCAC I4S .0/02 - Communication Rights 
10 NCAC I4S .0/03 - Lhing Environment 

Mental Health: Other Programs 

/O NCAC /SL .0603 - Svc Purpose/ Eligibility Requirements 

Agency Re\ised Rule 
10 NCAC ISM .0704 - Staff Requirements 

Agency Revised Rule 
10 NCAC /SQ .0809 - .Agreement Between Resident and Program 

Agency Revised Rule 

JUSTICE 

Criminal Information 



A RRC Objection 9//9i9J 
A RRC Objection 9// 9/ 9/ 



12 NCAC 

Agency 
/ 2 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

.Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 

12 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 
12 NCAC 

Agency 



4E .0103 - Advisory Policy Board 

Revised Rule 

4E .0104 - Definitions 

Revised Rule 

4E .0106 - Manuals 

Revised Rule 

4E .0203 - .\ on-Terminal Access 

Revised Rule 

4E .0301 - i ser Agreement 

Revised Rule 

4E .0302 - User Access Fee Agreement 

Revised Rule 

4E .0401 - DCl Terminal Operator 

Revised Rule 

4E .0403 - Suspension! Revocation of Operator Certification 

Revised Rule 

4F .0203 - Hit Confirmation 

Revised Rule 

4F .0301 - Arrest Fingerprint Card 

Revised Rule 

4F .0404 - Ind's Right: Review' Hisi Her! Crim History Record 

Revised Rule 

4 F .0405 - iseCCH Lie; Son-Criminal Justice Emp Purposes 

Revised Rule 

4F .0501 - Expungements 

Revised Rule 

4G .0/02 - Penalty Provisions 

Revised Rule 

40 .0201 - Notice of Violation 

Re\ised Rule 

4G .0301 - Informal Hearing Procedure 

Revised Rule 



I ICENSING BOARDS AND COMMISSIONS 

Architecture 

21 NCAC 2 .060/ - Committee on Investigations 
Agency Revised Ru/e 



A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 



A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 
A RRC Objection 
Obj. Removed 



9!19:91 
9! 19/91 
9!l9i91 
9I19!91 
9I19!9I 
9! 19191 



9il9.91 
9il9i91 

9!19i91 
9H9 91 

9 i 19.91 
9!19:9I 
9I19!91 
9! 19,91 
9il9i9l 
9I19!9I 
9!1991 
9;19 91 

9 19 91 
9! 19 91 

9/9 9/ 
9!/9!9l 
91/9191 
9 19 91 
9! 19,91 
9/19,91 
9! 19,9 1 
9/19/91 
9,19:91 
9/19/91 
9:19 91 
9,19/91 
9:1991 
9/19,91 
9,19,91 
9/19 91 
9/19,9/ 
9;/9/9/ 



A RRC Objection 9l/9:,9/ 
Obj. Removed 9/19,91 



6:16 NORTH CAROLINA REGISTER November 15. 1 99 1 



126S 



RRC OBJECTIONS 



Certified Public .Accountant Fxaminers 

* :/ XCAC 8G .03 J 3 - Firm Same RRC Objection 10, 17, 9 J 

Practicing Psychologists 

2/ SCAC 54 .1701 - Information Required A RRC Objection 8122/91 

Agency Raised Rule Obj. Removed 91 I9i9l 

21 NCAC 54 .2/03 - Reinstatement ARRC Objection 8/22/91 

.■igency Rexised Rule Obj. Removed 9/19/91 



1269 6:16 NORTH CAROLINA REGISTER November 15, 1991 



RULES INVALID A TED BY JUDICIAL DECISION 



1 his Section of the Register lists the recent decisions issued by the North Carolina Supreme Court, 
Court of Appeals, Superior Court (when available), and the Office of Administrative Hearings which 
invalidate a rule in the North Carolina A dministrative Code. 



ISA i\CAC 21D .0802(b)(2) - A VAILABILITY 

Robert Roosevelt Reilly Jr., Administrative Law Judge with the Office of Administrative Hearings, 
declared Rule 15A NCAC 21 D .0802(b)(2) void as applied in Wilson's Supermarket #12, Petitioner v. 
Department of Environment, Health, and Natural Resources, Respondent (91 EHR 0795). 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1270 



NORTH CAROLINA ADMINISTRA TIVE CODE CLASSIFICA HON SYSTEM 



The North Carolina Administrative Code ''NCACj has four major subdivisions of rules. Two 
of these, titles and chapters, are mandatory. The major subdivision of the XCA C is the title. 
Each major department in the North Carolina executive branch of government has been as- 
signed a title number. Titles are further broken down into chapters which shall be numerical 
in order. The other two, subchapters and sections are optional subdivisions to be used by 
agencies when appropriate. 



TITLE/MAJOR DIAISIONS OF THE NORTH CAROLPS A ADMIMSTRATrV E CODE 



TITLE DEPARIMENT 

1 Administration 

2 Agnculture 

3 Auditor 

4 Economic and Community 

Development 

5 Correction 

6 Council of State 

7 Cultural Resources 

8 Elections 

9 Governor 

10 Human Resources 

1 1 Insurance 

12 Justice 

13 Labor 

14A Crime Control and Public Safety 

15A Ln\ironment. Health, and Natural 
Resources 

16 Public Education 

17 Revenue 

1 8 Secretary of State 
19A Transportation 
20 Treasurer 

*21 Occupational licensing Boards 

22 Administrative Procedures 

23 Community Colleges 

24 Independent Agencies 

25 State Personnel 

26 Administrative Hearines 



LICENSING BOARDS 


CHAPTER 


,-\rchi lecture 


2 


Auctioneers 


4 


Barber Examiners 


6 


Certified Public Accountant Examiners 


8 


Chiropractic Examiners 


10 


General Contractors 


12 


Cosmetic An Exammers 


14 


Dental Examiners 


16 


Electrical Contractors 


18 


Eoresters 


20 


Geologists 


21 


Hearing .Vid Dealers and Fitters 


22 


Landscape jVrchitects 


26 


landscape Contractors 


28 


Marital & Earrdly Therapy 


31 


Medical Examiners 


32 


Midwifers- Joint Committee 


33 


Mortuary' Science 


34 


Nursing 


36 


Nursing Home Administrators 


37 


Occupational Therapists 


38 


Opticians 


40 


Optometry- 


42 


Osteopathic Examination and 


44 


Registration (Repealed) 




Pharmacy 


46 


Physical Therapy Examiners 


48 


Plumbing, Heating and Fire SprinUer 


50 


Contractors 




Podiatry Examiners 


52 


Practicing Counselors 


53 


Practicing Psychologists 


54 


Professional Engmeers and Land Surveyors 56 


Real Estate Commission 


58 


Refrigeration Examiners 


60 


Sanitarian E.xaminers 


62 


Social Work 


63 


Speech and Language Pathologists and 


64 


Audiologists 




Veterinarv' Medical Board 


66 



Note: Title 2 1 contains the chapters of the various occupational licensing boards. 



1271 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



CUMULA TIVE INDEX 



CUMLLA TIVE INDEX 

(April 1991 - March 1992) 



1991 



1992 



Pages 



Issue 



1 - 44 1 - April 

44 - 99 2 - April 

100 - 185 3 - May 

186 - 226 4 - May 

227 - 246 5 - June 

247 - 325 6 - June 

326 - 373 7 - July 

374 - 463 8 - July 

464 - 515 9 - August 

516 - 677 10 - August 

678 - 721 11 - September 

722 - 783 12 - September 

784 - 923 13 - September 

924 - 980 14 - October 

981 - 1107 15 - November 

1108 - 1275 16 - November 



AO - Administrative Order 

AG - Attorney General's Opinions 

C - Correction 

FR - 1-inal Rule 

GS - General Statute 

JO - Judicial Orders or Decision 

M - Miscellaneous 

NP - Notice of Petitions 

PR - Proposed Rule 

SO - Statements of Organization 

TR - Temporary Rule 



ADMIMSTRAIION 

State Construction, 465 PR 

State Employees Combined Campaign, 924 PR 

ADMINISTRATn E HEARESGS 

Hearings Division, 310 PR 
Rules Division, 665 PR 

ADMrVLSTRATIVE ORDER 

Administrative Order, 926 AO 

AGRICULTIRE 

rood and Drug Protection Division, 576 PR, 725 PR 

Markets, 576 PR 

North Carolina State Fair, 576 PR 



6:16 NORTH CAROLINA REGISTER November 15, 1991 



1272 



CUMULA TIVE INDEX 



Pesticide Board, 725 PR 

Plant Industr,-, 1(12 PR, 46^) PR, 576 PR 

CORRECTION 

Division of Prisons, 35 FR, 87 FR, 209 FR, 700 FR, 938 FR 

CRIME COM ROL AM) PI BLIC SAFETY 

State Iligliway Patrol, Division of, 809 PR 

CI LI I RAL RESOURCES 

Archives and History, 932 PR 
State I ihnin . 686 PR 

ECONOMIC AND COMMLN.ITV DEVELOPMENT 

iVlcoholic Beverage Control Commission, 4 PR 

Community Assistance, 104 PR 

Credit Union Division. 231 PR, 683 PR, 1108 PR 

Fmplo_\ment and 1 raining, 590 PR 

Savings Institutions Division, 984 PR 

ENMRONMENF, HEALTH, AND NATURAL RESOURCES 

Coastal Management, 299 PR, 1 139 PR 

Environment;!! Management, 197 PR, 271 PR, 447 PR, 1061 PR 

Forest Resources, 300 PR 

Health: Fpidemioloav, 28 PR, 341 PR, 735 PR 

Health Services, 9 I-R. 327 PR, 727 PR, 815 PR 

Land Resources. 4^4 PR, 810 PR 

Manne Fisheries, 122 PR. 690 PR 

Parks and Recreation. 6^3 PR 

State Registrar, 734 PR 

Water treatment Facility Operators, 495 PR 

Wildlife Resources Commission, 84 PR, 170 PR. 198 PR, 301 PR, 647 PR, 692 PR, 1062 PR 

FINAL DECISION Li: ITERS 

Voting Rights Act. 48. 230, 248, 326, 464, 516, 681, 722, 806, 927 

GENERAL SI A LUTES 

Chapter 150B, 784 GS 

GOVERNOR/L r. GO\ ERNOR 

Executive Orders, 1, 45, 100, 186, 227, 247, 374, 678, 804. 924, 981 

HU.M.AN RESOURCES 

Adns, Division of, 72 PR, 422 PR 

Blind, Ser\ices for, 686 PR 

Departmental Rules. 1114 PR 

Economic Opportunitv, 604 PR, 689 PR 

Facilitv Services, 104 PR. 471 PR. 5^2 PR, 1035 PR 

Medical Assistance, 9 PR. 112 PR, 188 PR, 232 PR, 250 PR. 430 PR, 492 PR, 601 PR, 688 PR, 

726 PR, 807 PR. 932 PR, 1036 PR 
Mental Health, Developmental Disabilities and Substance Abuse Services, 5 PR. 49 PR. 375 PR, 

449 FR 
Social Senices, 116 PR, 1039 PR 

INDEPENDENT AGENCIES 

Safety and Health Review Board of North Carolina, 1069 PR 



127i 6:16 NORTH CAROLINA REGISTER November 15, 1991 



CVMULA TIVE INDEX 



INSURANCE 

Actuarial Services Division, 1 19 PR, 1060 PR 
Agent Services Division, 1056 PR 
I'inancial livaluation Division, 933 PR 
Life and Health Division, 430 PR, 1114 PR 
Special Services Division, 84 PR 

.JUSTICE 

Criminal Justice Education and Training Standards, 607 PR 
Private Protective Services, 121 PR 
Sheriffs' Standards Division, 618 PR 
State Bureau of Investigation, 250 PR 

LABOR 

Occupational Safety and Health, 1138 PR 

LICENSING BOARDS 

/Vrchitecture, Board of, 30 PR, 232 PR 

Certified Pubhc Accountant Examiners, 201 PR, 935 PR, 1141 PR 

("osmetic /Vrt Examiners, 653 PR, 1066 PR 

1 lectrolysis Examiners, Board of, 737 PR 

(jcologists. Board of, 654 PR 

Hearing Aid Dealers and Eitters, 496 PR, 655 PR 

Landscape Contractors' Registration Board, 665 PR 

Medical Exammers, Board of, 304 PR, 363 PR, 935 PR 

Nursmg, Board of, 305 PR 

Optometrv, Board of Examiners, 1068 PR 

Pharmacy, Board of, 201 PR 

Physical Therapy Examiners, Board of, 33 PR, 363 PR 

Practicing Psychologists Examiners, 203 PR 

Professional Engineers and Land Surveyors, 497 PR 

Real Estate Commission, 171 PR, 500 PR 

[1ST OE Rl LES CODIFIED 

1 ist of Rules Codified, 89, 215, 314, 451, 504, 711, 907, 1087 

PUBLIC EDUCATION 

riementary and Secondary, 29 PR, 199 PR, 303 PR, 694 PR, 1 140 PR 

REVENUE 

Corporate Income and Franchise Tax Division, 816 ER 
Departmental Rules, 968 ER 

Individual Income, Inhcntance and Gift Tax Division, 739 ER 
Individual Income Lax Division, 234 ER, 747 ER 
intangibles Tax Division, 766 ER, 969 ER 

icense and Excise 'Lax Division, 740 ER, 969 FR 
Motor Fuels Lax Division, 768 FR 
Property Tax Commission, 210 ER 
Sales and Use Tax, 817 L'R 

SECRETARY OF STATE 

Securities Division, 85 PR 

lATE PERSONNEL 

Dffice of State Personnel, 696 PR, 1082 PR 
>tate Personnel Commission, 172 PR, 364 PR 

TATE TREASURER 

Retirement Systems, 736 PR 



6:16 NORTH CAROLINA REGISTER November 15, 1991 1274 



CUMULA TIVE INDEX 



STATEMKMS OF ORGANIZATION 

Statements of Organization, 518 SO 

TRANSPORTATION 

Assistant Secretary For Management, 1254 FR 

Assistant Secretarv' For Planning, 1259 FR 

Departmental Rules, 1142 FR 

Division of Hiehwavs, 1 146 FR 

Division of Motor Vehicles, 213 FR, 502 FR, 701 FR, 773 FR, 1229 FR 



1275 6:16 AORTH CAROLINA REGISTER November 15, 1991 



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